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MSME Registration

MSME Registration Details

Last Updated 23rd Sep 2020

Particulars Details
Registration Portal Ministry of Micro, Small and Medium Enterprises. https://msme.gov.in/online-application
Investment Criteria Below ₹ 50 Cr (Maximum limit)
Annual Turnover Criteria Below ₹ 250 Cr (Maximum limit)
Registration Fee ₹ 1,999
Certificate One Certificate for one enterprise
Benefits of Registration Take advantage of various government schemes initiated for the growth of MSMEs.

What are MSMEs?

MSME stands for Micro, Small and Medium Enterprises. The MSMEs are key contributors to the socio-economic development of the country. The MSMEs cover almost 95% of industrial units, 50% of exports and 45% of employment. Opting for MSME registration is not a statutory mandate; however, it is advisable to obtain the benefits of the Mirco, Small and Medium Enterprises Act. The initiative of MSME started functioning in 2006 to create a competitive environment and encourage small businesses to ensure speedy development and boost the economy.

The MSMEs are categorized in manufacturing sectors and service sectors. These two sectors have been further classified based on the investment. The classification has recently been reset based on investment and annual turnover to create a greater scope of growth for the MSMEs. Below is the reset classification of the micro, small and medium enterprises.

Criteria Mirco enterprises Small enterprises Medium enterprises
Investment Less than ₹ 1 Cr Less than ₹ 10 Cr Less than ₹ 50 Cr
Annual turnover Less than ₹ 5 Cr Less than ₹ 50 Cr Less than ₹ 250 Cr

In the earlier classification, manufacturing sectors and service sectors were allotted different investment limits. The maximum limit of investment was higher for manufacturing sectors than service sectors. However, the previous differences have been removed in the new classification. The classification given in the above table is for both manufacturing sectors and service sectors.

Registration Process For MSME

One can opt for MSME registration online and offline as well. The registration process for both the manufacturing sectors and service sectors can be done on a single platform of msme.gov.in. Following is the process of MSME registration.

Fill up the form for MSME registration

  • Go to the website of the MSME online application or paste this URL in another tab https://msme.gov.in/online-application.
  • Fill up the form online or take a print out and fill-up the form offline.

Prepare the documents

  • Prepare the documents with the assistance of the experts at MSME.
  • The process can take up to 2 working days.

Make the application

  • Submit the application form coupled with the required documents.
  • After submitting the application, verification takes place.
  • The verification can take up to 2 working days.

Approval and registration

  • The registration will be done if the application has been approved.
  • The MSME certificate will be delivered to you.

The MSME registration application form contains the following components.

  • Aadhaar details, PAN details, social category and gender of the entrepreneur.
  • Name and type of enterprise.
  • Address and contact details.
  • Investment amount.
  • Employee number.

The MSME registration fee is ₹ 1,999. Applicants can pay the fees using the online payment gateways. However, keep the investment limit in mind while applying for the registration.

MSME Registration Benefits

The reason behind MSME registration being appealing is the wide-ranged benefits. Here are the MSME registration benefits.

  • MSME registered enterprises can avail loans at lower interest rates than regular loans. Loans can be availed at an interest rate of as low as 1% to 1.5%.
  • MSME certificate holders can enjoy tax exemption under the MSME Act.
  • MAT or minimum alternate tax can be extended to 15 years from the regular 10 years.
  • MSME registered enterprises gets preference for government-issued license and certificates.
  • By getting registered under MSME, the cost of patenting and industry set up reduces due to various rebates and concessions.
  • Many government tenders are given to only MSME registered enterprises.
  • An MSME gets easy access to credit.

Documents Required for MSME Registration

To avail, the MSME registration benefits the following documents are required:

  • Aadhaar card
  • Property paper
  • Rent agreement
  • Cancelled cheque
  • Partnership deed (for partnership firms)
  • Memorandum of Association (for companies)
  • Articles of Association (for companies).
  • PAN
  • The social category of the applicant (General, SC, ST or OBC)
  • The physical ability of the applicant (disabled or not).

Some additional documents required for the registration are as follows.

Business address proof

  • Self-own property: allotment letter, property tax slip, possession letter.
  • Rented property: rent receipts and NOC from the property owner.

Company registration proof

  • Photocopy of sale bill.
  • Photocopy of purchase bill (of raw material).

License and purchase bills for machinery

  • Photocopy of an industrial license.
  • Bills of purchasing machinery and installations.

MSME Certificate

MSME certificates act as evidence of MSME registration. For registering more than one enterprise, applicants must go through separate MSME registration online or offline. The fees will be charged accordingly. Each enterprise will be allotted with an individual MSME certificate.

FAQs

Is registration compulsory for MSME?

No, registration is not compulsory for MSME. However, with the MSME registration comes with many advantages such as cheaper loans, lower projection costs and preference for Government tenders. Hence, it is advisable.

What is MSME registration certificate?

MSME registration certificate is proof of being registered as an MSME. The certificate is disbursed when an MSME application gets confirmed.

How long is MSME certificate valid?

MSME certificate is valid as long as the enterprise is functioning. However, a provisional MSME certificate is valid for 5 years.

What is the difference between Udyog aadhaar and MSME?

MSME refers to the Micro, Small and Medium Enterprises and Udyog Aadhaar is the 12 digit number MSME can avail by going through the Udyog Aadhaar registration process. This 12 numeric Aadhaar figure is required for the MSME registration.

Can an individual register for MSME?

MSME registration is for enterprises and businesses, not for individuals. However, a one-person enterprise or company is eligible for the MSME registration. The process and fees of the one-person enterprise will be the same as the regular MSME process and fees.

What is the purpose of MSME?

The purpose of the MSME is to help the micro, small and medium enterprises of India in growing further. These enterprises generate the majority of employment, industries and export in the country. Thus, by encouraging the MSME to grow will result in the socio-economic development of the country.


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