Ditching the nine to five jobs and starting your start-up is the dream of most of the Indian youths these days. India is a developing country and youths of today are enthusiastic about their work. To foster the growth of MSME(Micro, small and medium enterprises), the Indian Government proposed an NSIC acronym as National Small Industries Corporation. But most of us are confused between the MSME and NSIC. Here, we will see in detail the difference between NSIC and MSME.
Difference between NSIC and MSME
NSIC is the enterprise of the Indian Government which is created to support and promote the Indian MSMEs. It has been created in the year 1955 and has various technical centres and offices around the country.
The mission of NSIC – The purpose of NSIC is to promote and support the MSME sector by providing them with integrated support services like marketing, technology, finance and other services.
The Vision of MSME – The vision of the MSME is to be a premier organization fostering the growth of Micro, small and medium enterprises.
The MSME sector is governed under the MSMED (Micro, small and medium enterprises Development) Act, 2006with a perspective to support the MSME sector via various schemes, subsidies and incentives.
After the amendment now the existing classification of MSME is based on the investment criteria in plant and machinery equipment. Under the Aatmanirbhar Bharat Abhiyaan (ABA), the government has revised the MSME classification by adding combined criterion for both the investment and the annual turnover.
The earlier distinction between the services and manufacturing sectors under the MSME definition is now removed. Due to this removal it will create uniformity amongst the sectors. The following classification is the revised MSME where the investment and annual turnover both are considered for deciding an MSME.
Existing MSME Classification
< Rs.25 lakh
< Rs.5 crore
< Rs.10 crore
< Rs.10 lakh
< Rs.2 crore
< Rs.5 crore
What is the difference between the MSME and NSIC in terms of Benefits?
The MSME and NSIC differ from each other in certain aspects which are listed below:
Benefits for NSIC
In terms of Marketing Benefits
- The Companies registered under the NSIC can participate in International fairs organized in other countries.
- The NSIC registered companies can also participate in the trade fairs, business fairs and exhibitions organized in India.
- The Companies registered under the NSIC can also participate in the Tech-Mart exhibitions organized by the NSIC.
- The Companies who has NSIC Registration are also allowed to participate in Buyers-sellers meet with other industries and government associations.
In terms of Financial Support
- The companies registered under the NSIC enjoy the government assistance in obtaining the raw materials from government agencies and National and International sellers.
- Also, the companies registered under the NSIC get the assistance form bank in availing the credit facilities.
In terms of Technology Support
- The companies registered under the NSIC can also take help from the Government for new technologies and innovation.
- These companies can also get training in skills development.
- Assistance from the Government in computer-aided product designing.
Benefits for MSME
- In terms of Financial aid –
As per the Credit Guarantee fund Scheme, the MSME registered companies can avail collateral-free loans from the banks and other financial institutions.
- The MSME companies have higher chances of getting tenders from the Government of India.
- They also enjoy tax benefits as per the nature of the business type.
- Also, the MSME companies are exempted from the Excise duty in their initial years, depending upon the business type.
- They also financial advantages in terms of Octroi refunds and Stamp duty benefits.
- The MSME companies get concession in their electricity bills after they make an application to the Electricity Departments.
- The MSMEs are relieved in terms of delayed payments from their buyers. Also, they have the right to charge a rate of interest on late payments.
- The MSMEs get 50% subsidy on their patent certification after making an application to the concerned department with MSME Certificate.
- The MSMEs get the government aid in every way to expand their business on National and International platform. They are also eligible for the IPS (Industrial Promotion Scheme).
- Exemption of 1% on the interest rates of bank overdrafts.
Read our article:MSME Registration – Know the Entire Procedure
What are the Documents required for the NSIC and MSME?
Important documents required for both MSME and NSIC are:
Documents needed for NSIC
- Owners Identity proof such as (Aadhar card, Voter ID and Driving License)
- PAN card of Directors
- Company’s Incorporation Certificate.
- Address proof the registered Office (Possession Letter and Lease Agreement)
- Utility Bill, in case of owned land
- Rent Agreement and NOC from Landlord, if applicable
- AOA (Article of Association).
- Memorandum of Association
- Description of Product and service for the proposed NSIC registration
- Banker’s Statement to specify the financial position of the Company as per Application Form Performa (F)
- Measures for Quality Control Standard testing installed in the Company
- Past three years statement of Operations, sealed by CA.
- Financial Statements (Profit& Loss A/C, Balance Sheet, and Trading A/C) of the Company signed by an authorized person.
- Copy of MSME Certificate
- Declaration regarding dissociation with large companies.
- Receipt of equipped Plant and machinery.
- Copy of BIS license, if any.
- Description regarding Human Resource in the Company
- Certificate of ISO 9000, optional
Documents Required for MSME
- Address proof of the registered office.
- Copy of sales and purchase bills
- MOA/Partnership Deed
- Receipts of equipped Plant and Machinery
- Copy of the Industrial License
- NICC (National Industrial Classification Code)
- Cancelled Cheque
- Identity and address proof of directors
What is the difference in the Procedure required for the NSIC and MSME Registration?
The difference in procedure for registration is as given below:
Procedure for the NSIC Registration
- Apply online on the NSIC portal
At first, you need to register your Company online at the NSIC portal under the SPRS (Single Point Registration Scheme for Government Purchase).
- Filling details along with the Document submission
The applicant has to fill the details of the following:
- PAN Number of the Company that is to be registered.
- Name of the Organization.
- Business type
- Udhyog Aadhar Number
- GST Number
- Inspecting agency
- NSIC Branch preference.
- Major Category products
- Branch Details
Details like the Branch name, address, timings and contacts are sent to the applicant for which the applicant has selected the NSIC Branch.
- Documents Secularization
After the documents are uploaded, the applicant has to be physically present at the branch with the original documents handy for the verification purpose.
- Issuance of Certificate
The NSIC authorized person will verify all the documents and the above procedures involved and the NSIC Registration Certificate will be issued then.
Procedure for the MSME Registration
Apply online on the MSME Portal for MSME Registration:
The applicant needs to log in to the MSME portal and has to fill the 12 digits Udhyog Aadhar number.
Now, the applicant needs to fill the name of the Directors and generate an OTP (By clicking on “Validate and Generate OTP”) to validate the Aadhar.
Mark the gender selection and status of physically handicapped (YES/NO).
Now, the applicant will fill the following details:
- Organization Name
- Organization Type
- PAN card details in case of Private Limited Company or LLP or partnership or Cooperative Company
- Plant locations or Business operations unit.
- Registered Company Address (Details like State, district and PIN code).
- Date of commencement of business operations
- Bank details of the current account.
- The category of the organization
- Number of Employees in the organization
- The worth of plant and machinery employed
- DIC (District Industries Center) Location.
Issuance of Certificate
Finally, after furnishing all the detail, the concerned ministry will issue the MSME Certificate.
Since all the MSME companies are being operated under the NSIC, firstly you need to register your Company as MSME and obtain the MSME Certificate. After that, you will register your MSME under the NSIC.
The registration process of the MSME is quite easier in comparison to the NSIC registration. One can avail various government schemes and profits if the firm is registered as MSME and NSIC.
Read our article:What is NSIC Registration? Know Its Step by Step Procedure