Udyam Registration Benefits for MSME
Udyam registration, earlier referred to as Udyog Aadhaar or MSME registration, is a government initiative. It seeks to support Micro, Small, and Medium Enterprises (MSMEs) in India. It has a streamlined registration process and it offers a wide range of benefits for MSMEs. Udyam/MSME registration is a completely online process. It is a straightforward process that can significantly benefit businesses looking to establish themselves in the market and grow their business. Udyam registration benefits include access to government schemes and incentives, an enhanced level of credibility, recognition within the business community etc.
List of Udyam Registration Benefits
Access to government schemes & incentives
A major Udyam registration benefit is the opportunity to access government schemes and incentives. MSMEs registered under Udyam are eligible for various schemes and programs. These include the Pradhan Mantri Mudra Yojana, which offers financial support to small businesses. In addition, MSMEs can also take advantage of subsidies and tax benefits under the MSME Development Act.
Another benefit is that it also improves the credibility and recognition of MSMEs in the business community. It serves as an official form of recognition; it indicates that the government has vetted and approved the business. This can boost the perceived trustworthiness and credibility of the business. This is particularly important for small businesses looking to establish themselves in the market.
Access to government facilities & equipment
MSMEs that are registered under Udyam can also access a variety of government-run facilities and services, including technology centers and incubation centers. These facilities provide MSMEs with access to the latest technology and equipment. They also provide expert advice and guidance on how to grow and expand their business.
Intellectual Property Rights
Another one of the benefits of registration is in relation to intellectual property rights for MSMEs in India. MSMEs registration lets businesses safeguard their intellectual property such as trademarks, patents, and copyrights through the government-provided registration system. This can prevent unauthorized use of their intellectual property, and make it easier for the MSMEs to take legal action in case of infringement. Furthermore, MSMEs can access government schemes and incentives for Intellectual Property Rights (IPR) protection and promotion through registration under Udyam. These schemes may include financial aid for filing patents and trademarks, a 50% rebate on trademark registration and patent application fees, s well as access to legal and technical support for IP-related matters. Overall, registration can be a valuable tool for MSMEs looking to protect and promote their intellectual property rights.
Read More: Understanding Trademark & Its Registration Process in India
Finally, another MSME registration benefit is that businesses that are registered on the Udyam website are offered several bank-related benefits. For instance, MSMEs that are registered under Udyam are eligible for various loan schemes offered by government-owned banks. These schemes offer MSMEs access to credit at lower interest rates and with less stringent collateral requirements, making it easier for MSMEs to acquire working capital for their business.
Additionally, MSMEs with registration can also qualify for various government-subsidized schemes such as the Credit Guarantee Fund Scheme for Micro and Small Enterprises. This scheme provides credit guarantee coverage to eligible MSMEs to obtain loans from banks. It is primarily focused on businesses within the small-scale industry. Furthermore, MSMEs might also be eligible for priority sector lending. This a category of loans extended by banks to certain sectors such as agriculture, micro-enterprises, and education at reduced interest rates. Overall, it can open new financial opportunities for MSMEs, making it easier for them to secure the funding they need to grow and expand their business.
Other Udyam Registration Benefits
- Registrations and licenses: Businesses with Udyam registration acquire registrations and licenses quite easily. Additionally, they are also eligible for subsidized rates for Many registrations. For example, to all Udyam registered businesses, ISO certification is granted free of cost. They are also eligible for a reduced rate for barcode registration, etc.
- Subsidized rates for plant and machinery: Under the credit-linked subsidy scheme(CLSS), all small and micro-businesses with Udyam registration get a 15% capital subsidy (up to INR 15 Lakhs) on plant and machinery purchases.
- Protection against Delayed payment of Buyers: MSME-registered businesses enjoy protection against delayed payment of buyers. When the buyers have accepted the goods or services, they are liable to pay on time.
- Concession rate on various utility bills: Udyam-registered businesses are granted concessions on utility bills such as electricity bills, water bills, gas bills, etc; this is particularly helpful for businesses involved in manufacturing. In certain situations, registered businesses are also eligible for rebates on their electricity bill.
- Tax Benefits: Registered MSMEs are eligible for 15 year extension of their minimum alternate tax credit. All other unregistered businesses are only eligible for an extension of up to 10 years.
Frequently Asked Questions
Monjima is a lawyer and a professional content writer at LegalWiz.in. She has a keen interest in Legal technology & Legal design, and believes that content makes the world go round.
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