In India, the eCommerce sector is rapidly expanding. eCommerce has become more of a need than a choice, especially in light of the hidden COVID- 19 epidemic and several lockdowns in many sections of the country. Several new enterprises have emerged in the industry, and more and more brands are relocating their operations online. As a result, Ecommerce is an excellent platform for MSMEs, as many clients choose to purchase products and services online. So, if you are an entrepreneur or someone who wants to start an online business, this guide is perfect for you. In this article, we will understand the benefits of MSME Registration for eCommerce websites and businesses.
What is an eCommerce Website or Business?
Ecommerce, or electronic commerce, is a business concept in which sales transactions are conducted through the internet.
This format is followed by almost every shopping website. In simple words, An ecommerce website is one that allows you to buy and sell products or services over the internet.
Thus, If you are providing services or goods via an online platform, it can be considered as an eCommerce Business. Also, a platform such as a mobile app or a website will be considered as an eCommerce Website or eCommerce App.
The famous examples of eCommerce Websites or Businesses are Amazon and Flipkart.
What is MSME?
MSME stands for micro, small, and medium enterprises (MSME), which are businesses that manufacture, produce, process, or distribute commodities or provide services. Currently, the government classifies MSMEs as follows:
Micro, small, and medium businesses, according to the government, are a major contributor to the country’s economic growth. They assist in the industrialization of rural regions by providing work possibilities at a lesser cost. As a result, it provides these enterprises with a variety of incentives and subsidies. However, you must first get MSME Registration to avail of these benefits.
- Manufacturing businesses
- Enterprises that provide services
Why is MSME Registration Important for an eCommerce Website and Business?
The process of registering your firm with the Ministry of Micro, Small, and Medium Business Enterprises website is known as MSME registration. You will receive formal registration documentation once you have completed the registration process.
The Government of India formed the MSMED Act to provide numerous grants, subsidies, and business opportunities to MSMEs. eCommerce Websites or any other businesses face strong competition, lose valuable opportunities, and can’t retain customers.
In addition, the businesses miss out on several financial aid schemes that both the central and state government provide.
Also, MSME Registration provides special treatment when applying for licenses and certifications granted by the Government of India. A registered MSME is eligible for several refunds and reductions on patents and the costs of establishing a business.
Therefore, Missing MSME Registration can seriously damage the business progress and speed.
Know about the Benefits of MSME Registration for eCommerce Websites or Business
There are several benefits of registering your business or eCommerce with MSME. The most important ones that you must know are as follows.
- MSME Registration provides Improved marketing timeliness, a global client base, and adaptable business practices that can help earn profits as well as provide benefits to e-commerce websites or businesses. For example, online reach to attract new customers, experience and understanding personalization to improve the client procurement, and the use of service and feedback networks to optimize future sales experiences.
- Secondly, MSMEs with a registered business get much cheaper interest rates on bank loans. MSMEs can get loans with interest rates as low as 1% and more manageable EMIs.
- Similarly, MSMEs that are registered and have an MSME Certificate are eligible for tax exemption.
- For registered MSMEs, the Minimum Alternate Tax, or MAT, can be extended to 15 years. The normal MAT lasts ten years.
- A registered MSME is eligible for different refunds and discounts on patents and startup expenses.
- MSMEs can effortlessly obtain loans for their enterprises if they are registered.
- On the Udyam Registration Portal, MSMEs are given preferential treatment for public contracts because it is linked with the Government e-Marketplace and other portals that provide MSMEs with easy access to platforms and e-tenders.
- MSMEs can receive a One-Time Settlement Fee for sums that are late or unpaid.