Schemes & Benefits of doing MSME Business in India
The MSME ( Micro, Small & Medium Enterprises) sector employs more than 50 million people and contributes to 8% of India’s GDP. This sector requires less investment but gives huge returns in the form of enhanced manufacturing capabilities, better distribution of resources, and reduced regional disparities.
Therefore, the Government’s recent decision to finally do away with the investment criteria to define MSME and go for the annual sales turnover was a major move, giving impetus to you — the new age MSME entrepreneurs and the forerunners of the MSME sector in India.
The MSME sector in India has significantly accelerated the country’s economic and social development. This has improved the entrepreneurship and employment opportunities, only next to agriculture and that too, with a surprisingly lower capital cost.
Moreover, MSMEs are the biggest contributor to export and production in industries like candle-making units, logistics, printing and packaging, agro products etc. having the potential for growth. In short, MSMEs are the “engine of growth” for any developed or developing country.
Benefits Of Doing MSME Business In India
India has realised this early and gives significant support to MSME entrepreneurs. You can get a great number of benefits for doing MSMEs business in India, a few of which include:
This scheme was started to encourage women entrepreneurs and give them all the support needed to start a business. Under this scheme, women are provided capital, counselling, training and delivery techniques by the government so that they don’t just manage their business but also grow it.
A simple form of registration was introduced by the Government in 2006, known as Industrial Entrepreneur Memorandum (IEM).
The Memorandum reduced the need for industrial licensing requirements, removed restrictions on investment and expansion and facilitated easy access to foreign technology and foreign direct investment. This helps in bringing Indian businesses at par with global economies in a harmonised manner.
Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) has established itself as a significant institution in easing the flow of guaranteed free credit to units in the micro and small enterprise (MSE). Commendably, for the FY 2016–17, the recorded collective guarantee approvals were over 25 lakh with a cumulative loan amount of over ₹1,25,000 crore.
It was started to encourage manufacturing Micro and Small Enterprises (MSEs) tap and develop domestic/foreign markets while also accept the Bar Coding on products. Moreover, businesses can now avail the Credit Linked Capital Subsidy Scheme (CLCSS) to undertake any technological upgradation of MSME business.
Under CLCSS, 15 per cent capital subsidy, limited to a maximum of Rs 15 lakh (12 per cent prior to 29.09.2005 limited to a maximum of Rs 4.8 lakh) is provided to the eligible MSEs for upgrading their technology approved under the scheme.
Support for Your Effort To Grow
The government has been highly supportive of the manufacturing MSME sector in India and is encouraging them to use energy-efficient technologiesand manufacturing processes to cut down the cost of production and emission of GHGs. While this creates awareness, additional support is also being provided to the MSMEs to acquire Product Certification and Licenses from National and International bodies.
The Reserve Bank of India (RBI) has permitted three players to launch Trade Receivables Discounting System (TReDS). It is a digital platform where small businesses (MSMEs) can get admitted to investment by auctioning their trade receivables.
The aim of this scheme is to incorporate cold chain and conservation transportation facilities with no added server from the farm-to-fork counters. MSME businesses are also provided with tariff subsidies on power, excise exemption and regulations with subsidies on the capital venture as well.
How Can You Establish a Small Business in India?
You can’t become a corporate giant in a day. Your small business expands slowly with patience, hard work, and perseverance being the essential virtues required on your part that drive it forward. Below, we’ll do a quick follow-up on the steps that are required to be followed for establishing an MSME in India.
1. First, get a Director Identification Number (DIN) and also obtain Digital Signature Certificate from one of six private agencies authorised by MCA 21.
2. Book the brand name/company name online by submitting six names at the most on the MCA 21 website.
3. Keep your documents ready and also obtain the Certificate of Incorporation.
4. Get an official company seal to issue share certificates and important documents.
5. Obtain the Permanent Account Number (PAN) by filing Form 49A and getting all verifications done.
6. Obtain the Tax Account Number (TAN) by filing Form 49B which can be deposited at any TIN Facilitation Center.
7. Get your establishment registered within 30 days of business opening.
8. Register for GST if your annual turnover exceeds INR 20 lakh (for specific regions the amount is INR 10 lakh).
9. Fill out Form 1 and get registered for Profession Tax at the Profession Tax Office (State).
10. The allotment of Establishment Code Number will help you get registered with Employees’ Provident Fund Organisation (National).
12. Lastly, register for Medical Insurance.
By now, you must have realised how crucial small businesses are for the country’s socio-economic transformation. They generate jobs and contribute substantially to the economy. All that small businesses need is a bit more encouragement to realize their full potential.
Managing and Automating your business after registering with Indian govt. is where deAzzle solution will help you.