In our previous article, we discussed the MSME registration process in India. As it was an integral part of MSMEs in general, we had to talk about the benefits of MSME registration, that you can enjoy as a small business owner.
There are many legalities surrounding MSMEs in India, however, we’ll discuss the benefits and advantages enjoyed by entrepreneurs who have registered for MSMEs.
So let’s get into it!
What Is MSME?
MSME stands for “Micro, Small, and Medium Enterprises.”
These are businesses that are relatively small in size but play a crucial role in a country’s economy. MSMEs are the backbone of many economies around the world, providing employment, promoting entrepreneurship, and contributing to economic growth. Here’s a breakdown:
Micro Enterprises: These are the smallest of the small, often run by just one or a few people. They could be local shops, small online businesses, or even street food vendors. An example could be a neighborhood bakery operated by a family or a freelance graphic designer working from home.
Small Enterprises: Small businesses are a bit larger than micro-enterprises and may have a few employees. Examples include a local clothing boutique, a small software development company, or a family-owned restaurant in your town.
Medium Enterprises: These are bigger than small businesses, with more employees and higher revenue. A medium-sized enterprise might be a regional chain of stores, a mid-sized manufacturing company, or a technology firm with a broader market reach.
For instance, let’s take a look at a typical example.
Imagine a family-owned bakery (a micro-enterprise) that grows and expands into a small regional chain of bakeries (a small enterprise) and later evolves into a well-known regional or national pastry and confectionery brand with numerous outlets (a medium enterprise).
MSMEs are important because they create jobs, foster innovation, and contribute significantly to the economic health of a country. They’re often considered the engines of economic development and are supported through various government programs to help them grow and thrive.
Benefits of MSME Registration in India
One will get to enjoy several advantages after registering his/her business and obtaining Udyog Aadhar. The best thing about obtaining Udyog Aadhar is that the process is quite simple and in addition to that, one won’t have to handle the paperwork for obtaining Udyog Aadhar.
Check out the top 10 benefits derived from the numerous schemes that are offered by the Ministry of MSME to protect small enterprises and assist them in growth and development.
- Reduced rate of Interest from banks
- Collateral-free loans from banks
- Protection against delayed payments
- Fast resolution of disputes
- After getting registered with MSME, your business will be eligible for availing government scheme benefits which will include loans without guarantee, low-interest rates on loans, and easy loans.
- 15% subsidy under the CLCSS scheme for technology upgradation
- The exemption under the direct tax laws
- Carry forward the minimum alternate tax (MAT) credit for up to 15 years instead of 10 years
- Benefits under the Credit guarantee scheme
- Octroi Benefits
- Waiver of Stamp duty and registration fees
- Reimbursement of payment made for obtaining ISO registration
- Reimbursement of payment made for obtaining Trade Mark, Patent, or Intellectual Property
- Benefits for Industrial Promotion Subsidy (IPS)
- Benefit up to 75% of registration fees for Barcodes.
- You will have financial backing from the government for participating in foreign business expos.
- You will also get to enjoy other forms of subsidies that will help you in increasing your company’s revenue.
- Concession in electricity bills
- Your company gains preference for government certification
- You will get an exemption when your enterprise applies for government tenders.
You can read in detail about MSME Schemes from this official document of the Government of India.
In conclusion, the world of MSMEs in India is filled with immense potential and benefits for small business owners. Through the MSME registration process, entrepreneurs can unlock a wide array of advantages that pave the way for business growth and development.
With the added advantage of preference in government certifications and tender applications, the registration process simplifies many aspects of running a small business.
So, if you’re a small business owner in India, embracing MSME registration can be a game-changer, just like choosing the right software to manage your finances and books.
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