What are Micro, Small & Medium Enterprises ?
Micro, small, and medium enterprises (MSME) refers to any business that fits into one of these three categories. MSME businesses are the backbone of every economy and a driving force behind economic growth, ensuring that everyone benefits equally. They are usually more labor-intensive than major corporations and can supply a lot of jobs for a modest investment. MSME accounts up a significant component of India's industrial output and exports. It's also important for the industrial economy's development.
Why MSME Registration?
1. Encourage entrepreneurship: through the adequate flow of credit from financial institutions and banks. All banks and financial institutions recognize MSME and provide schemes for their commercialization. 2. Support for technological upgradation, infrastructure facilities 3. Employment opportunities: skill upgradation, capacity building, and training facilities. 4. Livelihood opportunities: the welfare of artisans and workers 5. Support for product development and access to the domestic and international market.
Why to Register?
The enterprises which are registered under the scheme are eligible for certain benefits provided by the government. These are: 1. Preferential Credit (priority sector lending), differential rates of interest, etc. 2. Excise Exemption Scheme 3. Exemption under Direct Tax Laws 4. Statutory support such as reservation and Interest on Delayed Payments Act 5. Development of specialized industrial estates 6. Power tariff subsidies, capital investment subsidies and other support
How helpful are Banks?
Rate of Interests are lower for the registered ones as compared to other enterprises.Public sector banks are permitted to categorize their MSME general banking branches as specialized MSME branches having 60% or more of their advances to MSME sector. This is to provide for a better service to this sector as a whole.
