Who can apply for MSME Registration in India?

Understanding MSME registration: Who can apply and how to do it?

Micro, Small and Medium Enterprises (MSME) form the backbone of any developing economy. To support and promote these enterprises, the government has launched MSME registration, which offers a range of benefits and schemes. However, enterprises often have questions about who can apply for the registration and how to do it. In this article, we’ll answer those questions and provide a step-by-step guide to MSME registration.

As said MSME stands for Micro, Small and Medium Enterprise. So these are divided into three categories.

  • Micro enterprise
  • Small Enterprise
  • Medium Enterprise.

The Ministry of Micro, Small, and Medium Enterprises (MSME) has set various parameters for dividing enterprises into three categories. These parameters are based on the investment made by the organization and its turnover. It’s important to note that exports of goods or services are excluded while calculating the turnover for classification purposes. The government uses these parameters to determine whether an organization is small, micro, or medium-sized.

Type of OrganizationInvestmentTurnover
MicroInvestment up to ₹ 1 CrTurnover up to ₹ 5 Cr
SmallInvestment up to ₹ 10 CrTurnover up to ₹ 50 Cr
MediumInvestment up to ₹ 50 CrTurnover up to ₹ 250 Cr

Every type of business entity including proprietorship, partnership firm, manufacturer, producer, limited company, private limited company, limited liability partnership firm, co-operative societies, any association of individuals, retailors, Hindu Undivided Family, or any other undertaking should get Udyog Aadhar Registration. Thus they can be eligible for MSME Registration.

The enterprise be it a manufacturing unit or the one that provides services all fall under the said category. All the manufacturing unit, service provide and even Traders are eligible to apply for registration. From July 2 2021 the government has included wholesale and retail traders under the MSME classification, making them eligible for priority sector lending offered by banks and other institutions as per RBI’s norms. The decision to include the traders under MSME is to ensure that even they can avail the schemes provided by the Government under Atamnirbhar Bharat.

Ministry of Micro, Small and Medium Enterprises vide Office Memorandum dated July 2 2021,has decided to include Retail and Wholesale trade as MSMEs for the limited purpose of Priority Sector Lending and they would be allowed to be registered on Udyam Registration Portal for the following NIC Codes and activities mentioned against them:

Nic CodeRetail and Wholesale Traders
45Wholesale and retail trade and repair of motor vehicles and motorcycles
46Wholesale trade except for motor vehicles and motorcycles
47Retail trade except for motor vehicles and motorcycles

The enterprise having Udyog Aadhar memorandum under the above mentioned NIC Code can apply for MSME registration.

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