15/01/2021
MSME stands for Micro, Small and Medium Enterprises. Businesses registered under the MSME Act, 2006 are categorized on the basis of investment in Plant & Machinery/Equipment as well as turnover.
Micro - Investment in Plant & Machinery/ Equipment up to Rs. 1 Cr. Turnover up to Rs. 5 Cr.
Small - Investment in Plant & Machinery/ Equipment up to Rs. 10 Cr. Turnover up to Rs. 50 Cr.
Medium - Investment in Plant & Machinery/ Equipment up to Rs. 50 Cr. Turnover up to Rs. 250 Cr.
MSME Registration can provide a wide array of benefits:
1) An MSME registered business can avail the benefits of collateral free credit to micro and small businesses, through the Credit Guarantee Trust Fund Scheme introduced by the government of India.
2) Incase of delayed payment to an MSME, where the delay exceeds 45 days, the buyer would have to pay the business monthly a compounded interest along with the actual amount due.
3) A 50% subsidy is given to MSME enterprises seeking patent registration. Additionally these enterprises can also get subsidies for industrial promotion .
4) MSMEs can avail a benefit of up to 1% on over draft facilities (differs as per the scheme offered by the Bank)
5) These businesses can avail concession on their electricity bills.
6) They can also reimburse the expenses paid for ISO Certifications.
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