Benefits of MSME Registration
Micro-Small & Medium Enterprises (MSMEs) contribute
widely to socio-economic growth. MSMEs come under the Ministry of Micro, Small
& Medium Enterprises. The advantage of getting registered under MSME is to
avail the benefits and subsidies offered from various Government initiated
schemes.
These lower limits are killing the desire for growth as they
are unable to scale their businesses further. Also, there has been a
long-pending demand for the revision of MSME classification so that they can
further extend their business. Now, under the Aatmanirbhar Bharat Abhiyan
(ABA), the government updated the MSME classification* by inserting composite
criteria of both investment and annual turnover. Also, the differentiation
between the manufacturing and the services sectors under the MSME definition
has been eliminated. This removal will create equality between the sectors.
MSME registration process renders many incentives and
privileges including financial and non-financial. These MSME registration
privileges are associated with the entrepreneurial and trade development of the
business.
Helps in getting low-interest rates
In the absence of collateral security, many businesses
owners may find it very hard to ensure a loan for starting their industry. But,
with an MSME Registration, all banks are specially instructed to offer credits
at interest rates, lower than the usual and one may be able to avail of the
advantage from numerous banking institutions for their needs.
Income Tax exemption:
MSME registration gives the benefits to save the amount
that may be appraisable to tax in the non-existence of the certificate. The benefit of an assumptive basis of taxation is available to companies, which
relieves one from maintaining detailed books of accounts and undergoing an audit procedure.
Credit Linked Guarantee Scheme:
The department of Micro, Small and Medium Enterprises,
and the Small Industries Development Bank of India (SIDBI) has set a Trust
named Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
especially to implement the Credit Guarantee Fund Scheme. This allows
collateral-free credits up to 50 lakhs for individual MSMEs.
Market assistance from the government and Export
Promotion:
The Government has organized several replacement
programs, craft festivals, exhibitions, and trade-related events universally.
Being categorized as a micro, small, or medium enterprise gives the path to all
of these platforms for international collaboration on trade-related aspects
with many different countries and promotes new business links. The government
also boosts the exportation of goods and services by MSMEs by way of subsidies,
tax exception, and technological support.
Capital and other grants for infrastructure
development:
Since MSMEs is a sector generating employment and giving
entrepreneurial ventures a boost, the government also identifies training
sectors for MSME and gives capital grants for the improvisation of the
infrastructure and support for entrepreneurial development.
Reimbursement of ISO Certification:
To increase the standards and certifications acquired by
MSMEs in a bid to improve their performance across sectors, all registered
micro and small industries can claim an exemption of all expenses incurred for
acquiring ISO 9000, ISO 14001 and HACCP certifications.
Exclusive purchases and sheltering from the competition:
As the role of the MSME Market Development Assistance scheme, the Central authorities follow a Cost and Purchase Choice policy.
Wherein more than 358 items are listed under it for independent purchases by
Central Government from the medium, micro, and small units only.
Technology and quality up-gradation support to MSMEs:
method to enhance the cost-effectiveness and promote
clean energy management in manufacturing units, the ministry compensates
project costs towards certain goals for MSME sector units and also expenditure
incurred for the implementation of clean technology, preparation of audit
records, and subsidies for licensing products according to national and
international standards.