MSME Registration India
MSME registration refers to the process through which micro, small, and medium enterprises (MSMEs) in India can register themselves with the government. The Ministry of Micro, Small & Medium Enterprises (MSME) provides this registration to enterprises that fall under the defined criteria. MSME registration helps businesses avail various benefits and schemes provided by the government to support their growth and development.
Overview of MSME Registration India
| Category | Manufacturing Enterprise | Service Enterprise |
| Micro | Investment in plant and machinery should not go beyond Rs. 1 crore and turnover does not exceed Rs. 5 crore | Investment in equipment does not exceed Rs. 10 lakh and turnover does not exceed Rs. 2 crore |
| Small | Investment in plant and machinery is more than Rs. 1 crore but does not exceed Rs. 10 crore | Investment in equipment is more than Rs. 10 lakh but does not exceed Rs. 2 crore |
| Medium | Investment in plant and machinery is more than Rs. 10 crore but does not exceed Rs. 50 crore | Investment in equipment is more than Rs. 2 crore but does not exceed Rs. 5 crore |
Which Companies Fall Under MSME Companies Category?
The following types of companies can fall under the MSME category:
- Individuals, startups, business owners, and entrepreneurs
- Private and public limited companies
- Sole proprietorship
- Partnership firms
- Limited Liability Partnerships (LLPs)
- Self Help Groups (SHGs)
- Co-operative societies
- Trusts
Eligibility for MSME Registration
To be eligible for MSME registration, businesses should meet the following criteria:
- Manufacturing or service businesses fulfilling the investment and turnover criteria mentioned in the MSME classification.
- Businesses registered in India and engaged in manufacturing, production, or providing services.
- Businesses that are not engaged in prohibited activities as defined by the MSMED Act, 2006.
- Sole proprietors, partnership firms, LLPs, private and public limited companies, self-help groups, co-operative societies, trusts, and individuals can all apply for MSME registration.
Income Tax Return in India: Know about ITR Forms, Filing Process
How To Apply for MSME Registration in India
The process of applying for MSME registration is entirely online and can be done through the Udyam Registration portal. Here’s a step-by-step guide to applying for MSME registration:
- Visit the Udyam Registration portal.
- Choose the “For New Entrepreneurs who are not Registered yet as MSME or those with EM-II” option.
- Enter the Aadhaar number and validate it with an OTP.
- Fill in the required details such as PAN number, personal information, and enterprise details.
- Provide investment and turnover details.
- Submit the form and validate the final OTP.
- After successful submission, the Udyam Registration Certificate will be sent through email.
Documents Required for MSME Registration in India
The documents required for MSME registration include:
- Aadhaar card of the applicant
- PAN card of the applicant
- Bank account details
- Information about the business, such as business name, type, and address
It is important to note that proof of documents is not required during the registration process, as the Udyam Registration Portal integrates with government databases to fetch information.
Types and Categories of Businesses under the MSME Sector:
The MSME sector encompasses a wide range of businesses in both the manufacturing and service sectors. Here are some examples of businesses that fall under the MSME sector 5 13:
- Leather goods manufacturing
- Moulding of items
- Natural fragrances and tastes production
- Management and placement services
- Institute for training and education
- Energy-saving pumps manufacturing
- Xeroxing services
- Crèches and beauty salons
- Garages and auto repair services
- X-ray hospitals
- Rental and leasing of equipment
- Photographic labs
- Maintenance of farm machinery for agriculture
- Back-office operations
- Local and international calling booths
- Low-capital retail trade enterprises
- Dish cable TV with multiple channels using a dish antenna
- Dry cleaning and laundry services
- Hardened metal ware manufacturing
- Electronic components for automobiles
- Electronic monitoring and security services
- Engineering mechanics
- VCRs, recorders, radios, transformers, motors, and watches production
- Plants’ micronutrients manufacturing
- Ayurvedic items and active pharmaceutical components production
- Products made from Khadi and Hosiery
- Crafting activities
- Paper printing and other paper-based products
- Coir furniture goods manufacturing
- Poultry farming
- Bicycle components manufacturing
- Stationery items production
- Contact centers
- Rubber products manufacturing
- IT services
- Industry testing laboratories
- Automobile companies
- Ceramics and glass products manufacturing
- Retail operations
Please note that this list is not exhaustive, and there are many more businesses that qualify as MSMEs based on their turnover and investment.
Govt Aid for MSME Companies
The government provides various aids and initiatives to support MSME companies. Some of the key government aids for MSME companies are:
- Access to collateral-free loans and priority sector lending from banks.
- Subsidies for patent registration, trademarks, and product certification.
- Financial assistance for technology upgradation and product development.
- Exemption from Stamp Duty and Registration fees.
- Assistance from business incubators for entrepreneurial and managerial development.
Subsidy from Government for MSME Registered Companies
The amount of subsidy granted to MSME companies varies based on the specific scheme and requirements. Some subsidies that can be availed by MSME companies include:
- 50% subsidy for bar code registration.
- Subsidy of up to 75% of the actual expenditure for obtaining product certification licenses.
- Reimbursement of ISO certification fees.
- Subsidies for specific industry-specific schemes like energy-saving pumps and manufacturing activities.
The maximum subsidy amount allowed per MSME is capped at certain limits based on the specific scheme.
Loan Schemes for MSMEs:
| Loan Scheme | Description |
| Pradhan Mantri Mudra Yojana (PMMY) | Offers loans up to Rs. 10 lakh to non-corporate and non-farm small or micro-enterprises. Classified as MUDRA loans under PMMY, provided by commercial banks, small finance banks, microfinance institutions, and NBFCs. |
| Prime Minister’s Employment Generation Programme (PMEGP) | Aims to generate self-employment opportunities for unemployed youth and traditional artisans. Provides financial assistance to set up micro-enterprises in the non-farm sector. Loans executed by the Khadi and Village Industries Commission (KVIC) through banks. |
| Credit Guarantee Trust Fund for Micro & Small Enterprises (CGTMSE) | Provides credit guarantee for loans granted to MSMEs by banks and financial institutions. Guarantee coverage ranges from 50% to 85% depending on loan amount and type of enterprise. |
| Credit Linked Capital Subsidy Scheme (CLCSS) | MSMEs can avail a subsidy of 15% on institutional finance for technology upgradation. Subsidy encourages adoption of state-of-the-art technologies and improves competitiveness. |
| Equity Infusion for MSMEs through Fund of Funds | Aims to provide equity funding for MSMEs with growth potential and viability. Government supports Venture Capital (VC) or Private Equity (PE) firms in investing in viable MSMEs, promoting their growth and listing on stock exchanges. |
How to check the status of your MSME registration application
To check the status of your MSME registration application, you can follow these steps:
- Visit the official website of the Udyam Registration portal.
- Click on the “Print/Verify” option on the homepage.
- Select the “Verify Udyam Registration Number” option.
- Enter the reference number received during the registration process.
- Enter the captcha code provided on the screen.
- Click on the “Verify” button.
- The status of your MSME registration application will be displayed on the screen.
What is MSME Registration Number
The MSME Registration Number is a unique identification number assigned to an enterprise after the successful completion of the MSME registration process. It acts as a proof of registration and is required to avail various benefits provided by the government to MSMEs. The MSME Registration Number is also known as the Udyam Registration Number.
The MSME Registration Number consists of 19 digits and is generated by the Udyam Registration Portal. This number serves as a permanent identity for the enterprise and is used for all future references. It is important to note that the MSME Registration Number is valid for a lifetime and does not expire as long as the enterprise remains ethical and financially healthy.
MSME Registration Certificate
The MSME Registration Certificate, also known as the Udyam Registration Certificate, is an electronically generated certificate that is issued to enterprises after the successful completion of the MSME registration process. It is a proof of registration and contains important details about the enterprise, such as its name, address, and type of business activity.
The MSME Registration Certificate serves as a primary document for availing various benefits and schemes provided by the government to MSMEs. It is required for accessing government tenders, applying for loans, and participating in trade fairs and exhibitions. The certificate also helps in establishing the credibility of the enterprise and building trust with customers and partners.
It is important to keep the MSME Registration Certificate safe and readily accessible, as it may be required for various business transactions and interactions with government authorities.
How to Download your MSME Registration Certificate
To download your MSME Registration Certificate, you can follow these steps:
- Visit the official website of the Udyam Registration portal.
- Click on the “Print/Verify” option on the homepage.
- Select the “Print Udyam Certificate” option.
- Enter your Udyam Registration Number.
- Enter your mobile number.
- Choose the OTP option (either on mobile or email).
- Click on the “Validate & Generate OTP” button.
- Enter the OTP received on your mobile or email.
- Click on the “Validate OTP and Login” button.
- After logging in, you will be able to view and download your MSME Registration Certificate.
What are the various benefits of MSME Registration
MSME Registration in India offers several benefits to registered entities. Here are some of the key advantages of having MSME registration:
- Access to Government Schemes and Incentives: MSMEs registered under the MSME Development Act, 2006 can avail various schemes and incentives offered by the Government of India. These include credit guarantee schemes, subsidies, financial assistance, and other support programs. Registered MSMEs can also participate in government tenders and procurement processes, which can be a significant source of business.
- Priority Lending by Banks: Banks and financial institutions in India offer priority lending to MSMEs, meaning they give preference to MSMEs while sanctioning loans. This makes it easier for registered MSMEs to obtain loans at favorable interest rates and with flexible repayment terms.
- Protection against Delayed Payments: The MSMED Act, 2006 provides protection to MSMEs against delayed payments from buyers. Registered MSMEs can file a complaint with the concerned authority in case of delayed payments and seek redressal.
- Tax Benefits: MSMEs can avail various tax benefits such as exemption from certain taxes, capital gains tax exemption, and other benefits under the Income Tax Act, 1961. Additionally, GST exemption limit for MSMEs has been increased from Rs. 20 lakhs to Rs. 40 lakhs, which means that small businesses with a turnover of up to Rs. 40 lakhs are exempted from GST registration.
- Brand Building and Credibility: MSME Registration can help in building a brand and establishing credibility in the market. It can also help in attracting customers and investors.
- Access to Training and Skill Development Programs: MSMEs can benefit from training and skill development programs conducted by the government or other organizations to enhance their business skills and capabilities.
- Support for Innovation and Research: Registered MSMEs may be eligible for subsidies and grants for research and development activities. This helps in fostering innovation and technological advancements within the MSME sector.
NIC Code for MSME Registration
The National Industrial Classification (NIC) code is a unique code that represents the type of business carried out by a company. It is required for MSME registration and helps classify businesses into specific categories. The NIC code can have two to five digits and identifies the main activity of the business. It is used to gather statistical information and classify businesses for various purposes.
MSME Registration Charges
There are no charges or fees required for MSME registration. The registration process is free of cost on the official Udyam Registration Portal. As a government initiative, the aim is to promote and support the growth of MSMEs by removing financial barriers to registration.
Trademark Registration Fees for MSME
The fees for trademark registration for MSMEs vary depending on the type of registration and the number of classes for which the trademark is being registered. The government fee for trademark registration ranges from Rs. 4,500 to Rs. 15,000 per class. However, it is advisable to consult a legal professional or visit the official website of the Ministry of Commerce and Industry for the most updated fees and requirements.
MSME Registration Fees Online
As mentioned earlier, there are no registration fees or charges for MSME registration. The entire process can be completed online free of cost on the Udyam Registration Portal. This initiative by the government aims to make the registration process accessible and affordable for all MSMEs.
MSME Registration for Partnership Firm
Partnership firms are eligible for MSME registration. The process and requirements for registration are the same as for other types of businesses. Partnership firms can apply for MSME registration through the Udyam Registration portal by providing the required details and documents.
How to Cancel MSME Registration (Describe in Detail)
To cancel MSME registration, the following steps can generally be followed:
- Visit the Udyam Registration portal.
- Choose the option for cancellation or closure of the MSME registration.
- Provide the necessary details, such as Udyam Registration Number, Aadhaar number, and other requested information.
- Submit the cancellation request.
- Upon successful submission, an acknowledgment of cancellation will be provided.
It is advisable to consult the official guidelines and follow the specific process mentioned on the Udyam Registration portal for cancellation of MSME registration.
MSME Registration in India FAQs
A: MSME registration provides various benefits, including easier access to bank loans, lower interest rates, preference in government tenders, tax benefits, and access to various government schemes and initiatives.
A: Yes, a business can be registered as both an MSME and under another relevant category based on its activities and requirements.
A: GST registration is not compulsory for all MSMEs. However, enterprises that mandatorily require GST registration under GST law must enter their GSTIN for obtaining MSME Registration.
A: Yes, one MSME registration can cover multiple activities, including service, manufacturing, or both.
A: Yes, an MSME registration can be modified or updated by visiting the Udyam Registration portal and making the necessary changes.
A: The status of MSME registration can be checked on the Udyam Registration portal using the Udyam Registration Number and other relevant details.
A: MSME registration in India is applicable only to businesses registered and operating within the country.
A: There is no specific time limit for MSME registration. Businesses can apply for registration at any time based on their eligibility and requirements.
A: MSME registration is not transferrable. If there is a change in ownership or any other relevant details, the new owner or entity must apply for fresh registration.
A: There is no age limit to avail MSME benefits. Eligibility for MSME registration is based on investment and turnover criteria, irrespective of the age of the promoter or owner.