Read on to know the various MSME registration benefits pertaining to small businesses:

1. Loans without collaterals:

The Government has introduced various initiatives for MSME/SSI that allow them to avail credit without collateral. One of the best MSME registration benefits, the initiative to provide collateral-free loan is undertaken by GOI (Government of India), SIDBI (Small Industries Development Bank of India) and the Ministry of Micro, Small and Medium Enterprise under the name The Credit Guarantee Trust Fund Scheme. This is by far the best MSME registration benefits for small business owners.

2. Subsidy on Patent Registration & Industrial Promotion:

Business enterprises registered under the MSME Act are given a hefty subsidy of 50 per cent for patent registration. This can be availed by sending an application to the respective ministry. In addition to this, one of the great MSME registration benefits is to get subsidy for industrial promotion suggested by the Government.

3. Overdraft facility along with Interest Rate Exemption:

Businesses or enterprises registered as MSME/SSI under the MSME Act are eligible to avail a benefit of 1% on the overdraft as part of the Credit Guarantee Trust Fund Scheme. Although this can vary from bank to bank.

4. Concession on Electricity:

One of the simplest MSME registration benefits, businesses registered under the MSME Act can avail a concession on electricity bills. All they have to do is submit the bills along with an application and a copy of the registered certificate by MSME.

5. Protection against Delayed Payments:

Understanding the ambiguity lying with business revenues, the Government has extended a helping hand by providing a layer of protection against payments. As of now, the Ministry of Micro, Small and Medium Enterprise has given business owners and enterprises to collect interest on payments delayed by the buyer.

Under the MSME registration benefits, a buyer is expected to make a payment for the goods/services within 15 days of the purchase. If the buyer delays, the payment for more than 45 days, the enterprise is eligible to charge compound interest which is 3 times the rate notified by RBI.

6. ISO Certification Charges Reimbursement:

A registered small or medium enterprise can claim the expenses for reimbursement that were spent on ISO certification.

The MSME industry is growing significantly due to the constant support from the Indian Government. This has further inspired everyone, especially the youth, to explore their entrepreneurial side and start their own venture. However, in such cases, knowledge regarding MSME and MSME registration benefits are a must to know.

Click here to apply for a business loans

DISCLAIMER

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.



Trending Articles

Popularly Searched Terms

How to Get a Business Loan

Need a Business Loan

Short Term Business Loans

Types of SME Loans

What is Penal Interest

Latest Articles

sme-finance
sme-finance

Government Lending Schemes for Your Small Business

Read More
Posted on 14 May 2020
sme-finance
sme-finance

How to Get Collateral-free Loans for Your Start-up?

Read More
Posted on 27 April 2020
sme-finance
sme-finance

Steps to Get a Loan to Start a New Business

Read More
Posted on 23 April 2020

Featured Articles

image abc-of-personal-money
abc-of-personal-money

Are Millennials Any Different When It Comes To Planning Financials?

Read More
Posted on 05 February 2020

Relevant Articles

image home-finance
home-finance

Why Employer Status Matters for Banks' Loan Eligibility?

Read More
Posted on 20 May 2020
image home-finance
home-finance

What Every Property Owner Must Know About Mortgage Loans?

Read More
Posted on 20 May 2020
image personal-finance
personal-finance

5 Benefits of Getting a Personal Loan for Travel in Advance

Read More
Posted on 18 May 2020