Benefits of MSME Registration for small businesses

Everything in this world starts from a unit particle or low level. How can we expect our industries and enterprises to be big and profitable from the beginning? For such newly or small scale industries with small profits and range MSME that stands for Micro, Small and Medium enterprises are introduced. Let us look into the important benefits of MSME.

What is MSME Registration ??

In a country like India where we still hold the board of still developing countries, small scale industries act as the backbone of the economy. Although it is not mandatory for them to register us MSME they will enjoy a lot of benefits based on taxation, setting up of business credit facilities loans, etc. under these MSME industries must have their investments as mention below: -This is the revised MSME classification of investment after the introduction of Aatmanirbhar Bharat Abhiyan (ABA). They will enjoy many benefits of MSME registration.

Benefits Of MSME Registration

Benefits of MSME Registration

Following is the benefit you may get if you are registered under MSME:-

1. The bank loans become much cheaper after MSME registration as the rate of interest reduces to 1 to 1.5% which is very low as compared to regular loans.

2. Under MSME you will be affected various tax rebates.

3. Instead of 10 years, it allows 15 years of credit for Maximum Alternate Tax (MAT) to be carried forward for credit.

4. Specifically, there are many governments tender only allotted to MSME registration.

5. Under MSME you enjoy easy accessibility to credits.

6. Once you get registered you will be provided many rebates and concessions which will reduce the cost of the patent has done or the cost of setting up the industry up to 50% subsidy. This will secure your IP and boost up your dream of becoming an esteemed and eminent corporation soon.

7. If your business is registered under MSME you will be prepared over other non-registered business for government license and certification irrespective of the field of your business.

8. For non-paid amounts of MSME, there is a scheme of a one-time settlement fee.

9. If you get registered under MSME you will get collateral-free loan options up to 200 lakhs that will be facilitated through banks and NBFS’s without putting any assets of yours at stake. This scheme is introduced by the Trust named Credit Guarantee Fund Trust for Micro and Small Enterprises established by the Ministry of Micro, Small and Medium Enterprises, and the Small Industries Development Bank of India.  

10. You being a registered MSME can get a 1% exemption on interest on an overdraft facility because of which a slight decrease in the cost of funds will be a huge benefit for the MSME business.

11. MSME businesses are labor-intensive groups that produce a lot of employment hence the government has provided them with some exclusive rights to manufacture specific products. For example, under the Government Stores Purchase Reserved Program, there are nearly 300 products reserved exclusively for the MSME sector by the Central Government.

12. Under Capital Aids for Technology Up-gradation scheme, the government encourages the MSME businesses to upgrade their equipment and infrastructure through the latest technology by providing them low-interest loans from banks. This also enhances the cost-effectiveness and promote clean energy use in manufacturing the government reimburses project costs towards the goals for MSME sector units and also preparation of audit reports, national and international level product licensing subsidies and implementation of clean technology by expenditure incurred. 

13. If you are registered under MSME and have a proper registration certificate you can get a concession on your electricity bills by providing an application to the electricity department along with the registration certificate of MSME.

14. Being a registered MSME you can claim the reimbursement of the expenses which were spent for the ISO 9000, ISO 14001, and HACCP certifications. It also helps to enhance their performance across different sectors.

15. MSME registered companies or businesses are eligible to get subsidy for Industrial Promotions under MSME as advised by the government.

16. Under MSME you get 15% subsidy on bank loans for fully automatic machinery and other subsidies like tariff subsidies and tax and capital subsidies etc.

17. As directed by the Reserve Bank of India the other banks have certain earmarked funds that should mandatorily be given to MSME businesses. So for long term and short term financing you can produce an MSME certificate and can avail loan on a priority basis with fewer hassles.

18. Registering under MSME will save you from spending lakhs of money as tax which will be assessable to tax in absence of tax certificate. This presumptive way of taxation relieves you from maintaining detailed records of documents and undergoing audit procedures.

19. Registered MSMEs will be provided access to several exchange programs, craft fairs, exhibitions, and trade-related events organized at international levels where you will be able to corporate on trade-related aspects with different countries, be able to know about their culture, customs and ways and promote new business connections. The government also stimulates the export of goods and services by MSMEs by way of subsidies, tax exemptions, and technical support.

20. As MSME is an employment and entrepreneurial generating sector the government ensures and provides training sectors and grant capital for spontaneity of the infrastructure and support entrepreneurial development.   

21. Lastly the biggest profit you gain by registering under MSME is the protection from the government against delayed payments which permits the free cash flow maintenance and forbid to keep bad and long non-paid debts. This is done by the scheme that when a registered MSME delivers a product or provides service, the buyer needs to pay on or before the date of payment and if no date is mentioned the payment should be made within 15 days of acceptance of service or product. If they fail to do so the buyer has to pay a fine to the MSME registered company.

Although not made mandatory by the government, it is an important necessity to get registered under MSME because as our government is making efforts for us so we should also step forward and grab these helping hands. 

Apply for MSME Certificate to avail all the benefits of MSME registration.

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