Being one of the countries where a lot of people do business as their main and only source of income.
Every business owner needs to know about what an MSME company is if their business falls under MSME company regulations.
today in this post you will learn about The MSME registration process, What are the benefits of registering oneself as an MSME company and other important things about msme.
These types of crucial information are important for every business owner to ensure a better job when it comes to trading, marketing, and so forth.
What is an MSME Company?
MSME is the short form for Micro, Small, and Medium Enterprises. Under this broad term, several companies can Fall. According to the MSMED (Micro, Small, and Medium Enterprises Development) Act of 2006,
two specific types of enterprises fall under this umbrella term.
- Manufacturing enterprises: These produce a specific product.
- Service enterprises: They provide a service.
list of a few businesses that fall under MSME.
- Leather products.
- Natural Flavors and Fragrances.
- Beauty Parlors.
- X-ray clinics.
- Stationery Items
- Call Centers
- Educational and Training Centers.
Eligibility Criteria for MSME registration
Following the release of the Micro, Small, and Medium Enterprises Development Act of 2006, there are specific criteria that need to be met by the businesses for them to register themselves as MSME companies.
1. Micro Enterprises
- The turnover should not exceed Rs. 5 Crore.
- Investment for the plant and machinery should not exceed Rs. 1 Crore.
2. Small Enterprises
- The Turnover should not exceed Rs 50 Crore.
- Plant and machinery investment should not exceed Rs. 10 Crore.
3. Medium Enterprises
- The turnover should not exceed Rs. 250 Crore.
- The Investment should not exceed more than Rs. 50 crore.
If these criteria are met, one can proceed to register the company as an MSME company.
Documents Required for MSME Registration
Before we discuss the MSME registration process, we need to know what documents are necessary for the MSME registration Process.
1. Aadhar Card
- In the case of a Proprietorship firm, the Aadhar card of the proprietor needs to be presented.
- In the case of the Hindu Unified Family, the Aadhar card of the Karta needs to be present.
- In the case of a Company, Society, or Trust, the Aadhar card of the Organizer needs to be presented.
2. PAN card
3. GSTIN (GST identification number)
- This is necessary if the company is registered under GST.
- This, however, doesn't imply that companies who are not affiliated with GST law or registered under the same need to get that done to be eligible for MSME registration.
These documents all need to be present during the MSME Registration process.
MSME registration is done online via a portal run by the Government of India, known as Udyam.
You must apply for a provisional SSI registration to get your MSME registration.
These Are the Documents that you would need to register for the SSI
- 3 passport size pictures of the proprietors, partners, or directors.
- In the case of partnerships, a photocopy of the deed is mandatory.
- For private companies, a copy of the MOA and AOA is necessary.
- Address proof is necessary.
- Consent from The Delhi Pollution Control Committee is also required for provisional registration.
After you have all the documents, you can proceed to apply for the SSI offline via the zonal offices.
Once the business is booming, you can make the SSI permanent, as, before that, the SSI is only valid for 5 years.
MSME Registration Process- Step-by-Step Guide
Step 1: Go to the online portal for the MSME registration process.
Step 2: Fill out the application form with the necessary details.
Step 3: Enter the personal details of the company owners, proprietors, partners, etc., as mentioned in the form.
Step 4: An executive will go through the request.
Step 5: If your request is granted, you will receive the MSME certificate in the mail.
Advantages of MSME Registration
1. 50% Subsidy on MSME registration
If your product is something innovative, then you have every right to patent it as an entrepreneur. With the help of MSME registration, you can patent your product with a 50% subsidy.
2. Collateral Free Loan
As a growing business, you might require several types of loans. With the help of MSME registration, you will not be required to provide something as collateral for this loan.
3. Exemption on interest on Overdraft
If your company has good credit, then it can apply for the 1% exemption on the overdraft facilities at the bank.
There are several benefits of the MSME registration that you can avail once you go through the MSME registration process.
In India, there has been a rise in entrepreneurs in the past few years, and the government must support them. That is why the government has provided every entrepreneur with the choice of being a part of the MSMED act to ensure the better growth of their business.
Final Words On MSME registration Process
Starting a business can be daunting, even if you are producing daily-use items.
That is why keeping your company with all the possible help you can get is necessary.
One of the most important of those is the MSMED act of 2006, which helps and provides security for starting companies.
Registering your company as an MSME can help you financially in several ways.
For further details, do consider visiting our website as we cover every base that there is.
FAQs On MSME Registration process in India
1. Is work order compulsory for registration of MSME portal?
Yes, it is necessary.
2. Who can’t be MSME?
Any company with a turnover bigger than Rs. 250 crores can’t be an MSME.
3. Is there any fee for MSME registration?
MSME registration is a completely free-of-cost process.
4. What issues does MSME face?
To name a few, some of the issues that an MSME may face that can impact their growth are:
Lack of innovation