MSME (Micro, Small & Medium Enterprises)

MSME is the abbreviation used for Micro, small and medium enterprises. MSM Enterprises or small-scale industries (SSIs) are like a backbone of the economy of the developing country like India. Following is the revised structure of MSME classification based on the criteria of both investment and annual turnover.

MSME- Benefits for Corporates and Enterprises

Financial support from banks facilitated by Government 

• It becomes easy to raise funds for the financial needs of the Micro, Small and Medium Enterprises once they’re registered with MSMED.
• Subsidized loans from banks with lower interest rates. It is one of the most significant MSME registration benefit.

Schemes by the Central Government for development of Small and Medium Industries 

• With schemes like Credit Guarantee Fund Trust for Micro and Small Enterprises
• Collateral-free loans are provided to the MSMEs.
• SIDBI provides financial aid to the MSMEs through Pradhan Mantri MUDRA Yojana.

Tax Benefits 

• Direct tax exemption benefits, if you are in the initial growth phase of your business.

Reservation of Products manufactured by MSMEs only 

• The Government has reserves certain products that must be produced by the Micro, Small and Medium Enterprises only.
• Moreover, the Government stores are bound to purchase certain products like wooden furniture, jewelry, pickles, etc from these industries only.

Easy recovery of Money - Protection against Delayed Payments

• If no payment is made in excess of 45 days after the goods and services have been supplied. In case the buyers do not comply with these provisions, they have to pay the penalty due to the delay in payment equals 3Times the current bank interest rate as set by the RBI.

Benefits to the Small Entrepreneurs who are registered under MSMED ACT

• Reduced Fees for Trademark Registration 
• Foreign Business Expo 
• An exemption in interest on Overdraft 
• Facilities to upgrade Technology used in the industry
• Subsidies and Government Schemes to promote your industry 
• Remuneration for ISO certification expenses 
• Reduction in Electricity Bills
• Subsidy on NSIC Performance and Credit Score.Marketing Support:
• The enterprises can get reimbursement on the registration fees of Barcode.
• Easy access to GeM: GeM is a wide online marketplace for the public procurement of goods & services.
• Availability of government tenders: The registered enterprises can easily get the government tenders without having to pay the security money for the participation. The MSMEs are exempt from paying the security bid money.
• ZED Certification Scheme
• Women Entrepreneurship benefits
• Credit Linked Capital Subsidy Scheme