If you want to take advantage of the MSMED Act of 2006’s benefits in the banking sector, you’ll need to register as an MSME.
When you register your company with Udyog Aadhaar, you may take advantage of a variety of state and federal government programmes. Furthermore, MSME Registration is required in order to profit from the MSMED Act 2006 in the banking sector.
- Avoid requesting security deposits.
- The cost of electricity will be decreased.
- Increased likelihood of getting federal contracts
- Reduced fees for filing patents and trademark registration in order to obtain protection under intellectual property rights.
- Bank loans are simple and inexpensive.
- Making a reservation has a number of advantages.
- Stamp duty and registration fees are not charged.
- Reimbursement for registration with a barcode
- Subsidy for the promotion of industry
- The interest rates of major banks have been cut.
Type of MSME Registrations
MSME Provisional Registration
The initial level of MSME registration is provisional, which is granted during the period leading up to the entity’s formation or the firm’s pre-investment period. At this time, the company is eligible for:
- Obtaining accommodations, land, and other resources
- Obtaining important approvals and letters of authorization
- Obtaining approvals from regulatory agencies such as the Pollution Control Board and the Department of Labor.
Small businesses can acquire term loans and operating capital from financial institutions and banks using the Provisional SSI Registration Certificate (PRC).
Permanent MSME Registration
Permanent registration is the second type of MSME registration. It is awarded to existing operational industrial units. Though the Act is not necessary, having government assistance is extremely beneficial to businesses.
Online SSI / MSME Registration Guidelines
Make an application for provisional registration
New businesses are given a PRC (Provisional Registration Certificate) without having to go through a field investigation. It’s solely a software-based form. As a result, it must be applied in the exact required manner before the unit’s functions can commence. The provisional registration will be issued without a physical examination of the unit after the application is completed. The procedure is short, allowing newly founded businesses to take advantage of a variety of perks, including speedy loans and other necessary clearances.
Getting Your Business Off The Ground
The provisional certificate is valid for five years, and the business must become active during that time. If the company does not start working within five years, a new application must be made.
Applying for SSI Registration on a Long-Term Basis
If the business is effectively launched within five years, the entrepreneur can apply for a permanent accreditation. The Ministry of MSMEs is where the registration is completed. Only particular conditions are met, and needed paperwork is provided, before a permanent SSI registration is approved.
- The unit has received the necessary statutory and administrative clearances.
- The unit does not break any rules or regulations.
- The value of the unit’s plant and machinery does not exceed the set limits.
- There should be confirmation that the company is not owned, controlled, or a subsidiary of another industry.
Vakilsearch is dedicated to assisting you in overcoming any obstacles that may emerge during MSME registration for your business.
Required documents for SSI and MSME registration
- Proof of business location
- Copies of the purchase and selling bills
- Partnership Deed / Memorandum of Agreement (MoA) and Letter of Agreement (AoA).
- Copies of licences and invoices for purchased machinery.
- No Industrial licence is required for businesses listed in Schedule -III of the Industrial Licensing Exemption Notification. Every other business must receive it in order to apply for a PRC (Provisional Registration Certificate).
- All statutory and administrative permissions are required for the registration and document process, including a NoC from the pollution board to verify that no limitations are being breached.
Creating a Current Account
Businesses utilise a current account, also known as a Demand Deposit Account, for a larger number of activities, such as deposits, withdrawals, and contra transactions. It aids in the seamless operation of a company.
Who should get SSI / MSME Registration if they have an Udyog Aadhaar?
The size of the company determines whether it is eligible for the MSME or SSI registration system. Proprietorship, Hindu Undivided Family (HUF), one-person company (OPC), Partnership Firm, public limited company, private limited company, production company, co-operative society, limited liability partnership (LLP), or any other undertaking are all eligible for Udyog Aadhaar registration.
Plant and machinery investments should be less than Rs. 25 lakhs in a manufacturing company. A service business should have an investment of less than Rs. 10 lakhs. Micro businesses are the tiniest of businesses.
Plant and machinery investments for manufacturing companies must be between Rs. 25 lakhs and Rs. 5 crores. The range for service businesses is between Rs. 10 lakhs and Rs. 2 crores.
If it’s a manufacturing company, the plant and machinery investment must be between Rs. 5 and Rs. 10 crores. The range for a service business is between Rs. 2 crores and Rs. 5 crores.
Suggested Read: Udyam Registration Process