How to Avail MSME Certificate?

What Is The Benefit Of MSME Certificate?

MSME stands for Micro, Small, and Medium Enterprises, which are major contributors to the country’s GDP. This includes the segment of enterprises in India where the investment in machinery and plants is less than one crore, ten crores, and fifty crores for micro, small, and medium categories.

Why Should Businesses get an MSME Certificate?

In India, business owners can reap several benefits with MSME registration.

1. Obtaining the MSME certification makes it easier to avail of different schemes eligible for different businesses and industries.
2. Technology Upgradation and Quality Certification, Marketing Promotion Schemes, and Infrastructure Development Programme are among the many options that business owners can tap into.
3. These are all focused on the development of different aspects of the business.
4. Collateral free bank loan options are available for MSME registered businesses. Irrespective of the age of the business, more flexible loans can be chosen at better rates.
5. During the unprecedented delays in reception of payments from buyers, MSME registration offers the advantage of protection against payment issues.
6. Interest collection is allowed on delays, and advance payments for secure order fulfilment.
7. ISO certification becomes much easier for enterprises that have an MSME certificate.
8. They can conveniently reimburse all the expenses incurred in the process.
9. While full reimbursements are available for ISO expenses, a subsidy can be claimed in the case of patent registration charges.
10. Given all these benefits, one should understand that the process of obtaining this registration is also quite simple.

Steps to get an MSME Certificate as a Business Owner in India

Ensure that your business belongs to the micro, small, or medium enterprise classification as per the standards. Based on the investment amount and the turnover (for running businesses), the suitable category is understood. To make sure that you tap into the potential of the numerous business-friendly schemes initiated by the Government, here is how you obtain the MSME certificate -

Online registration of the MSME certificate is the easiest and fastest way to go about it. Head on to the Udyam portal for MSME. Both new businesses and established ones who are yet to obtain the MSME certificate can make use of this portal. Online registration on the portal only needs the Aadhar number of the business owner, to begin with.

• On the Udyam portal’s homepage, select the option “For New Entrepreneurs who are not Registered yet as MSME” or “those with EM-II”.
• This takes you to the page where you will fill a few details in an online form.
• Ensure that you have your Aadhar card handy, as you need to fill out the details exactly as on the card.
• The Aadhar number and the name of the business owner are the two items to be furnished in this form.
• If it is a partnership enterprise that you are registering, then you will use the partnership firm’s Aadhar number for registration.
• For Cooperative Society and other firms, you will be asked for the GSTIN details.
• Click the option “Validate and generate OTP” at the bottom of the page.
• The OTP is sent to the mobile number registered with the entered Aadhar number.
• Upon entering the OTP correctly, you will be redirected to the page for PAN verification.
• Carefully select the organisation type and other details on this page.
• The PAN linked with the Aadhar is filled automatically.
• From the dropdown “Type of Organisation”, choose the type that your business belongs to.
• For existing businesses, the previous year’s ITR filing details will be verified.
• Select the option as “No” under the question where you are asked about the previous year’s ITR filing.
• The type of ITR filed will be required in case of existing businesses.
• Select whether or not your business has a GSTIN.
• Once you validate the PAN details form, you will then be taken to the page where the business owner’s details should be given.
• This is the last and critical stage of the online MSME certificate registration. Name, mobile number, social category, and gender of the entrepreneur should be filled.
• Fill in the registered address of your enterprise and the address details of the various plants.
• Enter other details pertaining to the organisation like the number of employees, investment amount, turnover, and other information. Finally, validate the business details filled in the online form.
• This sends the final OTP for registration to the same mobile number.
• Upon validation of the OTP, you should be able to see a message saying the certificate registration process is complete.
• You would also be given a reference number to keep track of the progress until you obtain the certificate.
• Upon successful verification of the furnished information, you will receive the MSME certificate within a few days.
• You can follow the above steps, no matter what type of business ownership you have planned.
• The above steps are applicable for a single owner and partnership firms as well as cooperative societies, trusts, and other organisations.
• Ensure that you provide the right details based on the ownership type registered on the business registration document.

Some Quick Points About MSME Certificate

• Every enterprise can do the MSME Udyam registration only once.
• This certificate is applicable both for new businesses that are about to be launched and those that have been functioning already for years, in case you missed registering.
• With a valid MSME certificate, you can easily obtain an MSME loan.
• These are offered through various banks and are highly beneficial for businesses.
• From training to the assistance in promotion and other activities, business owners can use numerous additional advantages once they have successfully registered their business.
• This certificate should be securely preserved to obtain relief schemes offered by the Government.
• You might have to rework on the registration or change the details provided as and when your business grows.
• Any changes in terms of the investment or the turnover or the ownership should be updated accurately so that you can maintain the validity of your MSME certificate.

Collection of All the Essential Paperwork for MSME Loans

1. From identity proof to the address proof in the form of Government ID, there are several documents that any business owner will need at the time of application.
2. Whether you choose to initiate the process online or from an office, you need to have the below documents ready -

• Aadhaar card of the business owner.
• Registered address proof for the business.
• Sale deed or purchase bill for proof of registration of the business on the business owner’s name along with the PAN card.
• Documents of the property.
• In the case of the rental properties being used for business, the rental agreement.

You should provide the above documents along with a cancelled cheque as the mandatory items for MSME certificate. Besides this, you also need to furnish other property documents based on the ownership or rental terms. If you are running the business from a rental property, you will need a NOC from the landlord. Electricity bills or rental receipts should also be kept ready for verification if required. For your own properties, there is no NOC involved. Just the possession letter or recent tax receipt that has your name on the property registration is enough.

Documents required in case of businesses where there are multiple owners or in the case of partnerships involved with other enterprises could be different. Besides the above-mentioned proofs, you would also need -

• Memorandum of Association
• Partnership Deed
• Articles of Association

For the investments you have already made in the form of machinery purchase, you should have the purchase bills and licenses with you.

From obtaining loans easily to being able to access additional funds at better interest rates, there are many reasons why every business owner in India should have an MSME certificate.

Also read:

1) MSME – Industries that form a Foundation for a Robust Economy
2) How is the Government helping Small Businesses & Startups fight the financial crisis?
3) What is Business Loan? A Complete Guide.
4) What are Some Beneficial Government Policies for Small Home-Based Businesses in India?