Importance of MSME Registration
The economic growth of a country does not depend just on multinational organizations or mega-scale industries, but also on the MSME industries. The MSME – Micro, Small and Medium Enterprises play a very important role in developing countries like India where the economy is largely dependent on agriculture and its related industries.
It can also be said MSME is the heartbeat of the country. So before we get into the detailed study of MSME, let’s take a look at what exactly is an MSME?
MSME stands for Micro, Small and Medium Enterprises. It is the initiation of the Government of a country to help and promote the small scale industries by offering various schemes and support. To benefit such incitements, MSME registration is very important.
Apart from MSME, Public and Private Companies, Proprietorship Firms are also eligible to register it under the MSME scheme.
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For the registrations of MSME, the owner must know where his company is classified in. For this, the government came up with a few definitions and regulations to classify the industries. The classification and definition of the industry is based on investments like the machinery and plants and separate sectors for the manufacturing and services.
The MSME is classified into two groups. They are as follows:
1. Manufacturing Enterprises – Those who are engaged in the production or manufacture of goods that are related to the industry or to employ machinery or plant. They are known in terms of machinery or plants.
2. Service Enterprise – Those who are engaged in rendering or providing of services fall under the Service Enterprises. They are known by investment in equipment.
Since they are based more on the terms of investment, they can be classified as follows.
- Micro Industries – The Company’s investment does not go beyond 25 lakh in the sector for manufacturing and 10 lakh in the service sector.
- Small Industries – In the manufacturing sector, it does not go above 5 crores and 2 crores in the service sector.
- Medium Industries – The investment in the service sector does not go beyond 5 crores and 10 crores in the manufacturing sector.
Benefits of MSME Registration
There are many benefits to get a business registered under the MSME Sector. There are many schemes covered by the State and the Central Government. The industries that are registered have better awareness about the current schemes initiated by the government and better accountability. Some of the basic facilities for the registered industries include easy access to subsidies and bank loans, eligible for various schemes initiated by the government, and law visibility.
Other prime benefits include acting as proof for your business, the departments will host trade fairs that would be beneficial for your business growth, they can go to MSME department for disputed or overdue amount, patent and trademark application will be given about 50% concession by the government, the tax is to be paid at a lower rate and many more. There would hardly be anyone who would want to miss this great opportunity.
MSME Registration Process
The act of MSME states that it is not compulsory for the industries to get it registered. But it is preferable to get it registered so that your industries are supported by the government. Because of the various schemes and help from the government, many small and medium scale industries are coming forward to avail of this opportunity.
The registration process is very simple for the MSME. It requires an application that must be submitted to the corresponding government offices. One must make sure the application form is correctly filled and must complete the details of the industry accompanied by other important documents. The time taken for the application process is around 15-20 days counting from the correct filling of the application form.
You must also provide other various details like your photo, personal details and many more. You must fill all the required information in the registration form. Your application form will then be reviewed and if they find any mistakes or discrepancies, you will be informed about it.
Once your application process is completed, you will get your MSME certificate. There will not be any hardcopy issued from the ministry. You will be given a virtual certificate.