{"id":6958,"date":"2020-04-18T11:16:08","date_gmt":"2020-04-18T05:46:08","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=6958"},"modified":"2020-04-18T11:26:36","modified_gmt":"2020-04-18T05:56:36","slug":"can-startups-benefit-from-msme-registration-for-better-govt-support","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/can-startups-benefit-from-msme-registration-for-better-govt-support\/","title":{"rendered":"Can Startups Benefit From MSME Registration For Better Govt Support?"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The Micro-Small and Medium\nEnterprises (MSME) is primarily defined in terms of their investment size. In\nthe context of the manufacturing sector, the MSMEs are basically categorized by\nthe investment made in the plant for service sector organizations.&nbsp; <\/p>\n\n\n\n<p>These types of companies play a\nsignificant role in the economy by employing a good volume of unskilled and\nsemi-skilled people. Their contribution to the economy is quite substantial in\nterms of employment, export, and output.<\/p>\n\n\n\n<p>Previously, Indian MSMEs were deemed less prominent from the rest of the world, but after the advent of the MSMED Act, the business has transformed into a competitive entity. It is essential to note down that an <a href=\"https:\/\/corpbiz.io\/msme-registration\"><strong><em>MSME registration<\/em><\/strong><\/a> is imperative to avail the advantage of MSMED Act, <\/p>\n\n\n\n<p>The MSME packs tons of benefits for\nthe small scale enterprise, few of them are mentioned below. <\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/can-startups-benefit-from-msme-registration-for-better-govt-support\/#Benefits_from_the_Banking_Sector\" >Benefits from the Banking Sector:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/can-startups-benefit-from-msme-registration-for-better-govt-support\/#Benefits_from_Central_Government\" >Benefits from Central Government:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/can-startups-benefit-from-msme-registration-for-better-govt-support\/#MSME_Registrations_Types\" >MSME Registrations Types<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/can-startups-benefit-from-msme-registration-for-better-govt-support\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Benefits_from_the_Banking_Sector\"><\/span>Benefits from the Banking Sector: <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The string of banks and financial\ninstitutions across the country duly recognize MSMEs and prepares rich schemes\nfor them that serve seamless commercialization. This radically results in\npriority sector lending under which the company can expect quick sanctioning of\na loan with a lower rate of interest. There is also a place for preferential\ntreatment in the context of repayment delay. <\/p>\n\n\n\n<ul><li><strong>Tax Benefits<\/strong><\/li><\/ul>\n\n\n\n<p>Based on the type of business, MSMEs\ncan avail exemptions in regards to central excise and direct taxes in the\ninitial years of its operation. <\/p>\n\n\n\n<ul><li><strong>Benefits from State Governments<\/strong><\/li><\/ul>\n\n\n\n<p>MSMEs operating under MSMED Act can\navail privileges on sales tax and other subsidies levied by the state\ngovernment.&nbsp; <\/p>\n\n\n\n<ul><li><strong>Subsidy on Patent Registration<\/strong><\/li><\/ul>\n\n\n\n<p>The MSME certified enterprises are\nentitled to reap the subsidy on patent registration. One has to apply to the\nrespective ministry via an application for the registration purpose. <\/p>\n\n\n\n<ul><li><strong>Overdraft Interest Rate Exemption<\/strong><\/li><\/ul>\n\n\n\n<p>The enterprises under the shadow of\nMSME can avail benefit of 1% on Over Draft that varies from bank to bank.<\/p>\n\n\n\n<ul><li><strong>Industrial Promotion Subsidy Eligibility<\/strong><\/li><\/ul>\n\n\n\n<ul><li><strong>Fewer Electricity Bills<\/strong><\/li><\/ul>\n\n\n\n<p>Enterprises with MSME accreditation\ncan avail subsidy for Industrial Promotion, as suggested by the Government.<\/p>\n\n\n\n<p>This liberty is given to all the\nEnterprises that work under the MSME Registration Certificate. To avail of this\nbenefit, one has to submit an application to the electricity department along\nwith the MSME registration certification.&nbsp;\n<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Benefits_from_Central_Government\"><\/span>Benefits from Central Government: <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>MSMEs also availed advantages from\nthe schemes offered by the Central Government. Registering an MSME is a simple\nand straightforward process. When contrasted with other entity formation, the\ndocumentation related to MSME is comparatively less tedious and cumbersome. <\/p>\n\n\n\n<p><strong><em>The following documents will be\nrequired for initiation for MSME: <\/em><\/strong><\/p>\n\n\n\n<ul><li>Rent Agreement or Sales Deed.<\/li><li>Canceled Cheque and the bank statement.\n<\/li><li>Aadhar Card, Passport, and Pan Card. <\/li><li>MSME Registration<\/li><\/ul>\n\n\n\n<p>MSME represents micro, small, and\nmedium enterprises. Being a prominent driver of the economy, MSME ensures\nequitable development for all. Compare to the large corporates, MSME Enterprises\nare labor-intensive and render enormous employment potential at a little\ncapital cost. <\/p>\n\n\n\n<p>MSME also share a major chunk of the\nindustrial production and exports in India. It is now pushing the development\nof the industrial economy to the new heights. <\/p>\n\n\n\n<p>Therefore, to trigger the development of the MSMEs, the <strong>MSMED Act<\/strong><sup><a href=\"https:\/\/msme.gov.in\/circulars\/msme-development-act-2006-rules-26-september-2006\"><strong>[1]<\/strong><\/a><\/sup> facilitates the development of businesses through many incentives, subsidies, and schemes. <\/p>\n\n\n\n<p>To reap the advantage of the MSMED Act, <strong><em>MSME Registration<\/em><\/strong> is an absolute necessity.\u00a0 The Act encompasses ranges of firms under its belt for registration such as:<\/p>\n\n\n\n<ul><li>Proprietorship firms<\/li><li>Private Limited Company<\/li><li>Partnership firms<\/li><li>Public Limited Companies<\/li><li>LLPs <\/li><\/ul>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/udyog-aadhar-registration-process-documents-and-fees\/\">Udyog Aadhar Registration: Application Process, Documents and Fees<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"MSME_Registrations_Types\"><\/span>MSME Registrations Types<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Provisional MSME Registration- <\/h3>\n\n\n\n<p>Provisional Registration generally\ngranted during the Pre- Investment period of the unit. This registration\nrenders the benefits like: <\/p>\n\n\n\n<ul><li>To get facilities for approvals,\naccommodation, and land.<\/li><li>To avail clearances and NOCs from\nregulatory bodies. <\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Permanent MSME Registration- <\/h3>\n\n\n\n<p>Permanent Registration Granted to an\nexisting unit working in an industrial sector and to get various benefits like:<\/p>\n\n\n\n<ul><li>Tax exemption.<\/li><li>Price and purchase preference for\ngoods produced.<\/li><\/ul>\n\n\n\n<p>MSME enterprises are the stepping\nstone to a healthy economy, and after the advent of the MSMED Act, these\nenterprises have got a global stature.&nbsp; <\/p>\n\n\n\n<p>There are a plethora of items which\nfall in the category of Micro and Small Enterprises (MSEs); these are as\nfollow:<\/p>\n\n\n\n<p>Pickles and chutneys, mustard oil,\nbread, groundnut oil, registers, and exercise books. Wooden furniture, candles,\nsafety matches, laundry soap, fireworks, glass bangles, agarbattis, steel\nalmirahs, and aluminum utensils. <\/p>\n\n\n\n<p>Though the items mentioned above\nreserved for MSMEs, they can also produce by medium or large units. But there\nis an exception to that.&nbsp; These units\nneed to comply with the minimum criteria of export, i:e, 50% of the annual\nproduction of the MSE reserved items. <\/p>\n\n\n\n<p>MSME sector has easy access to credit\nas a financial institution is required to ensure that a prominent part of their\nlending is made to these companies. <\/p>\n\n\n\n<p>Apart from the credits to the small\nenterprise sector, 60% reserved for micro-enterprises and 40% for small enterprises.\nLending to Micro and Small enterprises are given more priority than lending to\nmedium enterprises.<\/p>\n\n\n\n<div class=\"shadow1\">Under the (NMCP) to improve the\nprowess of the SMEs sector (MSME) is employing scheme &#8220;Building Awareness\non Intellectual Property Rights (IPR)&#8221; for the MSME.<\/div>\n\n\n\n<p>The scheme has prepared with a motto\nis to boost up the awareness of MSME regarding Intellectual Property Rights\n(IPRs) to set provision for protecting their business strategies. Therefore, to\nsupport the MSME sector to tackle the challenges of liberalization, several\nactivities on IPR are being employed under this scheme. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>It can be concluded that the MSMED Act is a boom to the economy, and it probably gets supported by some additional schemes from the Central Government. Ultimately, this would lead to faster development of the economy and make the MSMEs more competitive.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/rbi-extends-one-time-restructuring-scheme-for-msme-loans\/\">\nRBI Extends Deadline for One \u2013 Time Restructuring of MSME Loans\n<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Micro-Small and Medium Enterprises (MSME) is primarily defined in terms of their investment size. In the context of the manufacturing sector, the MSMEs are basically categorized by the investment made in the plant for service sector organizations.&nbsp; These types of companies play a significant role in the economy by employing a good volume of [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":6960,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[164,176],"tags":[498],"acf":{"service_id":"71"},"authorName":"Pankaj Tyagi","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/MicrosoftTeams-image-42.jpg","authorDescription":"Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.","postViews":35428,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/6958"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=6958"}],"version-history":[{"count":15,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/6958\/revisions"}],"predecessor-version":[{"id":6976,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/6958\/revisions\/6976"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/6960"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=6958"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=6958"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=6958"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}