The full form of MSME is Micro, Small, and Medium Enterprises, to promote small industries in the country and to help them financially, the Government of India has formed the Ministry of Micro, Small and Medium Enterprises. About 45% of the employment in India is due to small industries and about 50% of the goods exported by India are produced by small industries only. That's why the Government of India wants that more and more micro, small and medium industries should be opened in the country so that more and more employment can be generated.
New definition of MSME(2020)
Micro, Small and Medium Enterprises are abbreviated as MSME. According to the MSME Act made in 2020, MSMEs have been determined in 3 types, these are as follows:
1. Micro Industry
The industry with investment up to 1 crore and turnover up to 5 crore has been given the status of micro enterprise.
2. Small Industry
Enterprises with investment up to 10 crores and turnover of 50 crores are considered as small units.
3. Medium Industry
Those with an investment of up to 30 crores and a turnover of 100 crores have been considered as medium enterprises.
Benefits of MSME Registration
MSME registration helps in getting government tenders
Easy to obtain licenses, approvals and registrations irrespective of the sector of the business
Exempted under direct tax laws
ISO certification expense reimbursement
Helps in getting a lower interest rate
Registered MSMEs get tariff subsidy and tax and capital subsidy
The interest rate on the loan is very low
What are the documents required for MSME registration ?
Bank account number
Basic business activity
NIC 2 digit code
Investment Details (Plant/Equipment Details)
Turnover Details (as per new MSME definition)
Sales and Purchase Bill Copies
Copies of licenses and bills of machinery purchased