12 March 2021
The Indian government has always been in favour of providing benefits to Micro, small and medium enterprises (MSMEs). There are many advantages of obtaining MSME registration in India, which can be only availed if the business has registered itself as an MSME/SSI under MSME Act.
The Government of India has devised the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006. In legal terms, the definition of micro, small and medium enterprises can be best understood as
|Enterprise Category||Investment in Plant & Machinery
(Manufacturing & Product Industry)
|Investment in Equipment
|Micro||Investment in plant and machinery does not exceed INR 25 Lakhs||Investment in equipment does not exceed INR 10 Lakhs|
|Small||Investment in plant and machinery is more than INR 25 Lakhs but does not exceed INR 5 Cr||Investment in equipment is more than INR 10 Lakhs but does not exceed INR 2 Cr|
|Medium||Investment in plant and machinery is more than INR 5 Cr but does not exceed INR 10 Cr||Investment in equipment is more than INR 2 Cr but does not exceed INR 5 Cr|
In case, if any MSME registered enterprise supplies any goods or services to a buyer then the buyer is required to make the payment on or before the agreed date of payment or within 15 days from the day they had accepted the goods and services from MSME or SCI registered business( if there is no mention of the date of payment).
If the buyer delays the payment for more than 45 days after accepting the products or services then the buyer has to pay compound interest along with interests (monthly) on the amount that was agreed to be paid. The interest rate is three times the rate that is notified by the Reserve Bank of India.
MSMEs are rapidly growing with regular support from the government and youths who are inspired and bold enough to start their own venture. Therefore, knowledge about the registration process and its benefits is an absolute must in order to give a boost to the entrepreneurial spirit of MSME & SSI founders.We hope this article helps all of those who might have had any confusion related to the benefits of MSME registration in India and also to those who are willing to jump into an entrepreneur role or are having a Micro, Small to Medium scale business. Business Escalators are the best when it comes to MSME registration online and in providing all types of start-up, GST, MSME, legal and Accounting Support services too.
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