Micro, Small and Medium Enterprises (MSME) has been a backbone of the economic growth over the last few decades. MSMEs play crucial role in providing large employment opportunities on low investments thereby reducing the major employment problems and also help in industrialization of rural & backward areas. Government in order to support and promote the small business has extended relaxations to MSMEs through various subsidies, schemes and incentives. Government have been regularly proposingamendments for the smooth operations of small business.
In this article, we are going to brief you some of the developments in this sector as follows:
MSME registration process is most simplestby filling up only one page i.e., Udhyogaadhaar memorandum to get the unique UdyogAadhaar Number (UAN) without any documents in support and also no fees is charged. Certificate of Registration will be issued within 24 hoursIn the Union Budget 2018, corporate tax rate for the small enterprises was lowered from 30% to 25%MSME which have obtained Quality Management Systems ISO 9001 and/or Environment Management Systems ISO 14001 and /or Food Safety Systems certifications are allowed to claim the reimbursement of 75% of the certification expenses up to max limit of Rs.75,000Government of India has launched Credit Guarantee Fund Scheme for MSME under which banks shall provide Collateral free loan 50% subsidy for SSI registration can be availed by MSME by making an application to the Ministry.
Nowadays, multiple digital marketing strategies are also implemented by the organization in order to achieve maximum return on investment. MSME are also implementing the strategies which big organizations uses in order to increase their visibility in the market.
The central bank has also raised the 90 days window in terms of NPA to 180 days. This has extended the classification of loans as Non-Performing assets or bad loans for the small business.
Recently the Cabinet has approved to change the criteriafor classifying MSMEs. It proposes to define MSME Registration on the basis of annual sales turnover rather than on investment basis. Now there is no distinction between manufacturing and service unit.
The proposed thresholds are:
1.Turnover upto 5 crores- MICRO ENTERPRISE2. Turnover upto 75 crores- SMALL ENTERPRISE3. Turnover upto 250 crores- MEDIUM ENTERPRISE