24 Benefits of Obtaining Udyam Registration for MSMEs
Formally, MSMEs were defined in terms of investment in plant and machinery. But this criterion for the definition was long criticized because credible and precise details of investments were not easily available by authorities. Therefore in February 2018, the Union Cabinet decided to change the criterion to “annual turnover”, which was more in line with the imposition of GST.
The Central Government, after obtaining the recommendations of the Advisory Committee, had notified certain criteria for classifying the enterprises as micro, small and medium enterprises and had specified the form and procedure for filing the memorandum (Udyam Registration), with effect from 1st July, 2020.
Highlights of the Udyam Registration portal:-
I. Various portals available for udyam registration are:-
II. Entire registration process is online & without any paper, document or proof
III. Aadhaar number and PAN validation shall be required for Udyam Registration
IV. Old Udyog Aadhar Memorandum can be upgraded to Udyam Registration by verifying the PAN online
V. In case of any discrepancy or complaint, the General Manager of the District Industries Centre of the concerned District shall undertake an enquiry for verification of the details of Udyam Registration submitted by the enterprise
Following are the benefits of obtaining Udyam Registration:-
- The business owner can avail octroi and tax conession in states laws as applicable.
- Claim stamp duty and registration fees waiver.
- Exemption of 1% interest rate on Overdraft.
- Can avail subsidy from NSIC and credit ratings & Eligible for IPS subsidy.
- Reimbursement on the payment made for obtaining the ISO certificate.
- Reservation of products for exclusive manufacturing by MSME and SSI.
- Avail Excise Exemption Scheme.
- Avail exemption while applying for government tenders.
- Exemption under direct tax laws.
- Enjoy easy bank mortgages and Bank Business Loans
- Bank loans become cheaper as the interest rate is very low (Upto 1.5% lower than interest on regular loans
- Becomes easy to get licenses, approvals and registrations, irrespective of field of business as business registered under Udyam are given higher preference for government license and certification.
- Registered Udyams gets tariff subsidies and tax and capital subsidies
- Interest rate Subsidy on Bank loans
- Protection against delayed payments, against material/services supplied
- Ease of obtaining registrations, licenses, and approvals.
- MSME Registered entity gets eligible for CLCSS (credit linked capital subsidy scheme)
- Subsidy is available for Patent registration
- Industrial Promotion Subsidy (IPS) Subsidy Eligibility
- One can avail 100% Collateral Free loans from all banks
- Special consideration on International Trade fairs
- Bar Code Registration Subsidy
- Waiver in Security Deposit in Government Tenders and Departments
- Concession in Electricity bills