Micro, Small, and Medium Enterprises (MSMEs) play a crucial role in India’s economic growth, providing employment, fostering innovation, and driving exports. To support these businesses, the Government of India offers a range of benefits under the MSME Development Act, 2006. Registering as an MSME is the first step toward accessing these benefits and enhancing your business’s potential.
MSME registration is a government certification provided to small and medium-sized businesses and enterprises. It serves as a recognition of their contribution to the economy and ensures access to various subsidies, schemes, and incentives designed to support their growth.
The Micro, Small, and Medium Enterprises (MSMEs) sector is vital to India’s economic growth, contributing significantly to GDP, employment, and exports. To empower and support MSMEs, the Government of India provides numerous benefits to registered entities. Here’s a detailed breakdown:
MSMEs can secure collateral-free loans under the Credit Guarantee Fund Scheme (CGTMSE), enabling easy access to funds without risking assets.
MSMEs are eligible for subsidized interest rates on loans under schemes like the Prime Minister’s Employment Generation Programme (PMEGP) and Stand-Up India.
Banks classify MSMEs as part
of priority sector lending, making
credit availability easier and
faster.
MSMEs benefit from a 25% tax rate for companies with turnover up to ₹400 crores, while proprietorships and partnerships enjoy slab-based tax rates.
MSMEs with turnover below ₹40 lakhs (goods) or ₹20 lakhs (services) are exempt from GST registration. For North-Eastern states, these thresholds are ₹20 lakhs and ₹10 lakhs, respectively.
Eligible MSMEs can opt for the Composition Scheme to pay reduced GST rates (1% for traders/manufacturers and 5% for restaurants) and file quarterly returns.
Registered MSMEs can
claim reimbursements
for expenses incurred
during ISO certification, promoting global quality standards.
MSMEs have exclusive access to certain government tenders, ensuring a level playing field against large
corporations.
Under the Public Procurement Policy, 25% of all government procurements are reserved for MSMEs, with 3% exclusively for women-owned MSMEs.
Registered MSMEs can sell products directly to government agencies through platforms like the Government e-Marketplace (GeM).
MSMEs are legally protected under the MSME Development Act, 2006, which mandates buyers to make payments within 45 days of accepting goods/services. Delayed payments attract interest at three times the RBI’s bank rate, safeguarding the business’s cash flow.
MSME exporters benefit from reduced customs duties and tax refunds under schemes like RoDTEP (Remission of Duties and Taxes on Exported Products).
The government provides financial assistance to MSMEs for participating in international trade fairs and exhibitions, encouraging global market access.
MSMEs exporting goods can access credit insurance through the Export Credit Guarantee Corporation (ECGC) protecting them against payment defaults.
MSMEs can receive subsidies under the Credit Linked Capital Subsidy Scheme (CLCSS) to upgrade technology and improve operational efficiency.
The government conducts various
skill development and training
programs to enhance
workforce capabilities in
MSMEs.
This scheme offers financial support
to MSMEs for achieving
higher quality standards
and adopting sustainable
practices.
MSMEs enjoy subsidies or concessions on electricity tariffs, reducing operating costs in states that implement such
measures.
State governments offer subsidized land and reduced stamp duties for MSMEs setting up operations in industrial areas.
The government promotes cluster-based development, providing shared facilities, infrastructure, and support services to MSME groups.
MSMEs can avail up to 50% subsidy on filing fees for patents, trademarks, and designs to encourage innovation.
Businesses conducting research and development activities can claim tax deductions under Section 35 of the Income Tax Act.
MSMEs registered as startups under Startup India are eligible for
incubator support, funding, and tax holidays.
The government provides support for the rehabilitation of sick MSMEs by offering financial assistance and restructuring opportunities
to help them regain operational health.
Schemes like PMEGP and others provide financial assistance to MSMEs to create new job opportunities.
Some states offer subsidies on EPF contributions to businesses employing a certain number of workers.
At Praans Consultech, we make the MSME Registration process simple, fast, and hassle-free.
Whether you’re a budding entrepreneur or an established business owner, we’re here to help you unlock the benefits of MSME registration
Manufacturing Enterprises: Businesses involved in the production of goods.
Service Enterprises: Businesses offering services in various sectors.
The eligibility is determined based on the investment in plant and machinery or equipment and the annual turnover:
Businesses with an investment of up to ₹1 crore and an annual turnover not exceeding ₹5 crore.
Businesses with an investment limit of ₹10 crore and an annual turnover up to ₹50 crore.
Businesses with an investment of up to ₹50 crore and an annual turnover capped at ₹250 crore.
I recently availed of shop and establishment registration services from a Praans Consultech , and I am extremely satisfied with the experience
With 15 years of rich experience in labour law, business registration, and startup advisory, Mr. Sandeep Kumar serves as the guiding force shaping our company’s vision and achievements. He is a proficient expert with a solid academic background. He holds an LLB and LLM, and is an alumnus of XLRI, one of India’s premier business schools. Currently, he is pursuing a Ph.D to further expand his knowledge and expertise in business and law.
Before embarking on his entrepreneurial journey, Mr. Sandeep Kumar held the prestigious role of Director at a renowned logistics company, where he led large teams and drove strategic initiatives that contributed to the company’s success. Even with a successful career and a lucrative job, he made the courageous choice to leave his corporate position and pursue his passion-creating a business dedicated to assisting entrepreneurs in navigating the complexities of labour law and business registrations.
As an advisor to startups and a legal expert, he has worked with various businesses to ensure they comply with industry regulations, streamline their registration processes, and create strong foundations for long-term success. His work blends legal expertise, strategic insight, and a passion for supporting businesses at every stage of growth.
MSME registration is a government certification that recognizes Micro, Small, and Medium Enterprises and allows them to access various benefits and schemes.
No, it is not mandatory but highly recommended to avail government benefits and protections.
Manufacturing and service sector businesses within prescribed investment and turnover limits can apply.
Benefits include easier loan access, subsidies, tax exemptions, protection against delayed payments, and more.
Yes, the entire process is online through the Udyam Registration Portal.
Aadhar Card, PAN Card, business details, and investment/turnover details are required.
Yes, any eligible existing business can apply.
You can receive the MSME certificate immediately after verification.
No, the government does not charge any fee for MSME registration.
Yes, the MSME registration certificate is valid for a lifetime unless revoked due to non-compliance.
No, MSME registration is only for manufacturing and service businesses.
Yes, you can update your details on the Udyam Portal.
Yes, GST is mandatory for MSME registration if applicable to your business.
You won’t be eligible for government schemes, benefits, or legal protections offered to MSMEs.
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