How to register as a MSME in india ?

Covid19 has clearly brought the world to a standstill, claiming millions of lives while also providing a greater strain for the economy as a whole to make ends meet. In these challenging times it appears that the old saying survival of the fittest has come to life

On the 13th of may, 2020, honorable finance minister nirmala sitharaman introduced a series of measures towards uplifting in a manner, the economy reflects what the prime minister dubbed atmanirbhar bharat to empower the country with infusion of liquidity and creation of a self sufficient and self reliant India.

This could not have been possible without the inclusion of the micro, small and medium enterprise sector in the set of reforms introduced as, micro, small and medium enterprise in total contribute to 45 per cent of india industrial employment 50 per cent of india total exports and 95 per cent of all industrial unit of the country and more than 6000 types of products. Business registered as micro, small and medium enterprise are entitled to numerous facilities and benefits, thus it becomes pertinent to examine which business fall under the definition of micro, small and medium enterprise and what all compliance need to be made to register as the one to reap the benefit presented by the government.

The definition of micro, small and medium enterprise.

In a developing country like india micro, small and medium enterprise form the backbone of the economy.

In her latest press conference on 13th of may, 2020 , the finance minister proposed to change the definition of micro, small and medium enterprise in order to bring both service and  manufacturing sector micro, small and medium enterprise under the same bracket of composite criteria of investment and turnover. The categorization is as illustrated in a table below for better understanding.

Subsequent to qualifying as a micro, small and medium enterprise the following needs to be ensured to get registered in order to reap maximum benefits available which are.

Various tax rebates offered to businesses registered as micro, small and medium enterprise.

Micro, small and medium enterprise act 2006 specifies forty five day credit period for the recipient of any goods and service to pay to the micro, small and medium enterprise supplier.

They get easy access to credit.

Quality management standards and technology tools are both important. It helps the micro, small and medium enterprise to understand the need for delivering quality products and business are sensitized via conference, seminar and activity.

Helps innovator with the implementation of their new design or ideas by government financing of 70 per cent to 80 per cent  of the project cost.

Capital subsidy is given to the business which upgrade from the use of obsolete technology.

Further it is a boon for the women entrepreneur to start their own business with the government providing them with requisite capital, counseling and training.

Other recent interventions for micro, small and medium enterprise upliftment.

Electronic market linkage for micro, small and medium enterprise to be promoted to act as a replacement for trade fairs and exhibitions.

Fintech will be used to enhance transaction based lending using the data generated by the electronic marketplace.

Government has been continuously monitoring settlement of dues to micro, small and medium enterprise vendor from government and central public sector undertaking.

Micro, small and medium enterprise receivables from government and central public sector enterprise to be released in 45 days


An important highlight when seeking registration is that trading concern are not eligible for registration under the provisions of this act. In order to get registered the company needs to fill an online form without any registration fees. The registration form can be accessed at and keep the following documents handy.

Copy of an aadhaar card. In case of an entity other than proprietorship firm the aadhaar of partner and director is required

Copy of Partnership Deed.

Copy of Sale and purchase bill.

Copy of business address proof.

Copies of the licence and the invoices for the machinery purchased. In few cases, the applicant has to submit a copy of the industrial license which is to be obtained by giving an application to government of india. Furthermore all bills and receipts related to purchase and installation of plant and machinery have to be kept safe and required to be submitted on demand.

For the compliance part, form micro, small and medium enterprise needs to be filed on the ministry of corporate affairs portal for furnishing half yearly return in respect of outstanding payments to micro and small enterprise.

Procedure of registration.

Firstly subsequent to reaching the udyogaadhaar website , a mobile one time password is generated.

Secondly consequent to which compulsory fields like permanent account number and name and type of organization and  activity type and address and bank details need to be filled in.

Investment in plant and Machinery also needs to be filled in.

National interchange code details too need to be entered to select the type of business.

After filling in the details an email id one time password needs to be entered before final submission.

An udyog aadhaar memorandum and an acknowledgement is issued after successful registration.

The micro, small, and medium enterprise legislation act of 2006 exempts some activities.

Ministry of micro, small and medium enterprise has clarified as per notification vide s.o. 2576  dated 18th of september, 2015, and subsequent notification no vide s.o. 85 dated 10th of january, 2017, activities that would be specifically not included in the manufacturing and production of commodities and rendering of services as per Section 7 of the said act.

Forest and logging.

Fishing and aquaculture.

Wholesale retail trade and repair of motorvehicle and motorcycles.

Except for motor cars and motorbikes wholesale commerce is prohibited.

Except for motor cars and motorbikes retail trading is prohibited.

Households activity as domestic personnel employees.

Undifferentiated goods and services producing activities of private households for own needs.

Activities of extraterritorial organizations and bodies.

Conclusion and suggestion.

Also read udyog aadhaar print

Thus in order to fully benefit from the recent benefits announced for the micro, small and medium enterprise and in order to recoup the business from the currently worsening pandemic situation any business falling under the above stated investment and turnover limits should not think twice in registering themselves as micro, small and medium enterprise and save themselves from the higher compliance requirement those are required by other business to comply with. It is the right time to grow with the seed of an idea in the business world because the government is ready to feed that idea and give it a chance to grow not only to become self sufficient but also to be ready to serve across the globe with the finesse imbibed in us.

However as a suggestion one would like to emphasize that if trading concerns are also included to qualify as micro, small and medium enterprise, it would act as an encouragement to them to experience similar growth with small capital as any manufacturing concern would.

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