MSME Registration is an important registration for many businesses in India as most businesses are from MSME Sector. However, most businesses do not know much about it. In this article, you will get to know about the services covered under MSME. You will also get to understand about other important information relating to MSME Registration or Udyam Registration.
What is MSME Registration?
MSME stands for Micro Small Medium Enterprises. In India, most businesses are MSMEs. Hence to boost the Indian Economy and benefit the MSMEs, the government has launched MSME Registration.
In simple words, MSME Registration is a process to register as MSME with the government. It allows the government to offer beneficial schemes to businesses under MSME Category.
The MSME Registration allows both goods and services businesses to enroll under the scheme.
It is important to note that it is not mandatory to register under MSME. However, it is mandatory to have MSME Registration for availment of certain benefits.
What is Udyam Registration?
Udyam Registration is another name given to MSME Registration. It is the same scheme and registration, however the name is the only difference.
The reason behind the name change was an update in eligibility criteria for MSME Registration.
Eligibility for MSME Registration
|Classification||Investment and Turnover|
|Micro||Less than One Crore & Maximum Five Crore|
|Small||Less than Ten Crore & maximum Fifty Crore|
|Medium||Less than Fifty Crore & maximum Two fifty Crore|
What are the Services covered under MSME?
The MSME Registration has specific criteria for businesses that are eligible for the registration.
These businesses must be supplying the following goods or services to be eligible to get Udyam Registration. Thus, the business of Goods of Services covered under MSME is as follows:
- Manufacturing Enterprises
- Services Enterprises excluding trading companies.
Some common example of Services covered under MSME:
- Healthcare and hospitality
- IT Service Provider
What is NIC Code for MSME Registration?
NIC code stands for National Industrial Classification Code. It is a tool used by the government to track economic activities. It also helps to identify the type of business.
The NIC Code is generally used for application of MSME Registration or LLP Registration or any other company incorporation.
The NIC Code for MSME Registration means:
- 2 to 3 digit NIC Code represents the group of business activities
- 4 digit code specifies business class activity
- The 5 digit code represents a subclass of business activity.
Document Requirement for MSME Registration
- Aadhar Card
- PAN Card
- Bank Account Details
- Type of business entity
- Previous Udyam Registration Details if any
- Number of persons employed in the business
- Business Type or Company Formation Details
- Investment in Machinery or Equipment
Benefits of MSME Registration
- It provides an entrepreneur with a variety of government-sponsored perks, such as lower-interest loans, secured loans, and loans without a guarantee, and several regular schemes..
- MSMEs that are registered are also eligible for financial assistance when they display their products at international trade shows.
- The holder of an Udyog Aadhaar is eligible for government incentives.
- MSME Registration facilitates the creation of bank accounts in the name of the company.
- It enables businesses to apply for micro-loans and other small business loans.
- There is a certain reservation for MSMEs in government tenders.
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