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10 Key Benefits of MSME / Udyam Registration

MSME is an acronym for Micro, Small, and Medium Enterprises. The classification is based on investments for Plant, Machinery, or Equipment and annual turnover which is as follows:

An enterprise shall be classified as a micro, small or medium enterprise on the basis of the following criteria, namely: —

(i) a micro-enterprise, where the investment in plant and machinery or equipment does not exceed one crore rupees and turnover does not exceed five crore rupees;

(ii) a small enterprise, where the investment in plant and machinery or equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees; and

(iii) a medium enterprise, where the investment in plant and machinery or equipment does not exceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees.

An enterprise for the purpose of this process will be known as Udyam and its Registration Process will be known as ‘Udyam Registration’. A permanent registration number will be given after registration. After completion of the process of registration, a certificate will be issued online.  The Udyam Certificate is a valid document accepted to avail any schemes, concessions, and authorization. If anyone applicant is trying to register multiple MSMEs, they must apply for separate registration for each enterprise. And for each of these, a separate MSME certificate is issued. Do note that there are no fees for applying for this registration and Only Aadhaar number, GST, PAN (Self-declaration) shall be required for Udyam Registration.

Here-in we summarise 10 key benefits registered MSMEs can avail of :

  1. Registered MSME can get lower interest rates on bank loans.
  2. MSME registered entity gets eligible for CLCSS (credit linked capita subsidy scheme)
  3. Registered MSMEs with an MSME Certificate can avail tax exemption.
  4. Minimum Alternate Tax or MAT for registered MSMEs can be extended to 15 years. Whereas the regular companies the MAT is for 10 years.
  5. MSMEs registered under the Ministry of MSMEs get priority on applications of licenses and certificates issued by the Government of India.
  6. A registered MSME gets various rebates and concessions on patents and the costs of setting up industry. 
  7. MSMEs are given preference for government tenders on the Udyam Registration Portal.
  8. MSMEs are given Government security deposit (EMD) waiver, which is very useful while participating in a tender
  9. Avail of subsidy on Patent registration
  10. MSMEs can avail a One Time Settlement Fee for delayed or non-paid amounts of MSME.
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