MSME stands for Micro, Small and Medium Enterprises. These industries or enterprises form the backbone of our economy and need assistance and protection from other big companies as they lack resources and technology. To do this the government provides some schemes, rebates or counselling to these enterprises.
The existing MSME classification was based on the criteria of investment in plant and machinery or equipment. So, to enjoy the MSME benefits, they have to limit their investment to a lower limit, as mentioned below:
Existing MSME Classification
|Manufacturing||Investment||< Rs.25 lakh||< Rs.5 crore||< Rs.10 crore|
|Services||Investment||< Rs.10 lakh||< Rs.2 crore||< Rs.5 crore|
These lower limits are killing the urge to grow as they are unable to scale their businesses further. Also, there has been a long-pending demand for the revision of MSME classification so that they can further expand their operations while continuing to avail the MSME benefits. Now, under the Atmanirbhar Bharat Abhiyan, the government revised the MSME classification by inserting composite criteria of both investment and annual turnover.
Also, the distinction between the manufacturing and the services sectors under the MSME definition has been removed. This removal will create parity between the sectors. The following is the revised MSME classification, where the investment and annual turnover, both are to be considered for deciding an MSME.
Revised MSME Classification
|< Rs.1 crore|
< Rs.5 crore
|< Rs.10 crore|
< Rs.50 crore
|< Rs.50 crore|
< Rs.250 crore
* Further upward revision made by the government
The revision of MSME classification allows for further scaling of business and also increases healthy competition among businesses.
Aadhaar card is a 12 digit number given to all individuals by the government. In this, the Aadhaar card is a mandatory requirement. The benefit of registering in this scheme is the ease in availing credit, loans, and subsidies from the government. Registration can be done both ways in the online mode or the offline mode.
In this model, goods that are manufactured for export have to adhere to a certain standard so that they are not rejected or sent back to India. To achieve this the government has launched this scheme. In this, if the goods are exported these are eligible for some rebates and concessions.
Registering in this scheme will help the micro, small and medium enterprises to understand and implement the quality standards that are required to be maintained along with the new technology. In this scheme, activities are conducted to sensitize the businesses about the new technology available through various seminars, campaigns, activities etc.
Registering under this scheme is beneficial in terms of getting the complaints of the business owners addressed. In this, the business owners can check the status of their complaints, open them if they are not satisfied with the outcome.
This scheme helps innovators with the implementation of their new design, ideas or products. Under this from 75% to 80% of the project cost can be financed by the government. This scheme promotes new ideas, designs, products etc.
Under this scheme, new technology is provided to the business owners to replace their old and obsolete technology. The capital subsidy is given to the business to upgrade and have better means to do their business. These small, micro and medium enterprises can directly approach the banks for these subsidies.
This scheme is especially started for women who want to start their own business. The government provides capital, counselling, training and delivery techniques to these women so that they manage their business and expand it.
The government has launched a number of more schemes and support system for these enterprises, to know more about the MSME schemes the following link of the government can be checked.