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The entrepreneurs are in for some new opportunities in exchange for a few compliances. It won’t be that difficult for the sake of the achievements you are after. For any new business adventure, you need to be thoroughly informed about the new government mandate for MSME registration.
What is MSME?
MSME stands for micro, small and medium enterprises and any enterprise that falls under any of the three categories as mentioned in the MSMED Act. The act is going to play a pivotal role in economic development, promoting equity and growth.
The earlier classification was based on the amount of investment and the machinery/equipment used by the enterprise.
The earlier investment criteria are laid down below:
Sector | Investment Criterion |
Micro | Small | Medium | |
Manufacturing | Up to Rs. 25 Lakhs | Up to Rs. 5 crores | Up to Rs. 10 crores |
Services | Up to Rs. 10 Lakhs | Up to Rs. 2 crores | Up to Rs. 5 crores |
The low investment criteria often served as an obstacle to growth, which prompted the necessary revision of the MSME classification. This revision was the Government’s response under Aatmanirbhar Bharat Abhiyan. The present classification now has brought the annual turnover and investment under the umbrella of MSME.
The following is the summary of the revised criteria:
Classification Criteria | Annual Turnover | Investment |
Micro | Less than Rs. 5 crores | Less than Rs. 1 crore |
Small | Less than Rs. 50 crores | Less than Rs. 10 crores |
Medium | Less than Rs. 250 crores | Less than Rs. 50 crores |
Why Apply for MSME Registration?
The MSME registration is at the sole discretion of the Entrepreneur. But most businessmen apply and obtain the registration to avail the benefits of protections under the MSMED Act of the Government of India.
We have listed some of the important benefits of MSME registration below. If you are an MSME certificate holder, then you can:
The State Government and Union Territories too have issued their own package of facilities for the MSMEs. Some of them are listed below:
Steps for registration
The registration process is fully online and free. Visit https://udyamregistration.gov.in/ for registration online. If you are to register with the PAN card then :
Registration without PAN Card is the same, except that you have to click at ‘No’ when asked ‘Do you have a PAN?’. You can then move on to filling in the necessary details. But you have to update your PAN and GSTIN on the portal to avoid Udyam registration cancellation.
Documents Required
The portal has suggested that only the Aadhar Number is enough for the registration. But the enterprise will have to submit :
The Validity of MSME Registration
The MSME registration certificate is valid as long as the business is operational. However, the registration is subject to suspension if the set criteria are not met.