What is MSME

MSME stands for Micro, Small and Medium Enterprise (MSME), introduced by Government of India in agreement with Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 are entities engaged in the production, manufacturing, processing or preservation of goods and commodities.

MSME sector is considered as the backbone of Indian economy that has contributed substantially in the socio-economic development of the nation. It generates employment opportunities and works in the development of backward and rural areas. As per the Government’s annual report 2018-19, there are presently 6,08,41,245 MSMEs in India. For your understanding let’s discuss some of the basics of MSME, including its classification, features, role and importance in socio-economic development of India.

New MSME Classification

The distinction between the manufacturing and services enterprises has been removed by making the investment amount and annual turnover similar for enterprises engaged in both the sectors.

• Micro Enterprise Investment less than Rs. 1 crore Turnover less than Rs. 5 crore.
• Small Enterprise Investment less than Rs. 10 crore Turnover up to Rs. 50 crore
• Medium Enterprise Investment less than Rs. 50 crore Turnover up to Rs. 250 crore

Benefits From Government

• Collateral Free Loans to MSMEs
• MSME Loans worth of Rs. 3 lakh crore
• Moratorium period offered is 12 months
• Manufacturing and Service MSMEs shall be considered as same entities
• Repayment Tenure of 48 months
• 100% Credit Guarantee
• To benefit approx. 45 lakh units

Features of Ministry of MSME (MoMSME)

• Works for the welfare of artisans and workers
• Provides credit limit or funding support from banks
• Promotes entrepreneurship development and skill upgradation via specialized training centers
• Supports technology upgradation, infrastructural development and modernization
• Offers assistance for improved access to domestic and export markets
• Provides modern testing facilities and quality certification
• Supports packaging, product development and design intervention

Role of MSMEs in Indian Economy

In 1961, with the merger of the Ministry of Small Scale Industries and the Ministry of Agro and Rural Industries; the Ministry of Micro, Small and Medium Enterprises (M/o MSME) was formed.

MSMEs produces and manufactures a wide variety of products for domestic, as well as international markets. MSMEs help in the promotion of growth and development of Khadi, Village and Coir industries, in co-operation with concerned ministries, state governments and stakeholders.

Below mentioned data in tabular representation is as per Central Statistics Office (CSO) and Ministry of Statistics & Program Implementation.

Opportunities in MSMEs

• The opportunities in the MSME industry are massive due to the succeeding factors:
• Export Promotion and potential for Indian products
• Funding – Finance & Subsidies
• Government’s Promotion and Support
• Growth in demand in the domestic market
• Less Capital required
• Manpower Training
• Project Profiles
• Raw Material and Machinery Procurement
• Tooling & Testing support and much more

Importance of MSME

MSME was launched in 2006 to become an integral part of the supply chain for products and services; moreover, a creator of large-scale employment opportunities in rural India. MSMEs contribute to approximately 8% of India’s GDP, employs over 60 million people, has an enormous share of 40% in the exports market and 45% in the manufacturing sector.

Q.1 What is MSME Samadhaan Portal ?
Ans : MSME Samadhaan is a Portal created by Office of DC(MSME), Ministry of Micro, Small and Medium Enterprises (MSME) where Micro and Small Enterprises (MSEs) can file their applications online regarding delayed payments.
Q.2 Do Ministry of MSME take action on applications filed on MSME Samadhaan Portal ?
Ans : No, MSME SAMADHAAN online portal is developed by Ministry of MSME only to facilitate
MSEs filing of their applications regarding delayed payments online. The application once filed is forwarded automatically online to the concerned Micro and Small Enterprise Facilitation Council (MSEFC) established by the State/UTs as per the provisions of MSMED-Act 2006. Action on the

applications regarding delayed payment is taken by the concerned MSEFC only.
Q.3 Can Ministry of MSME intervene in matters of MSEFC.
Ans: No. Only the MSEFCs have been empowered as per MSMED Act, 2006 for taking decisions regarding its reference made with them. This office does not intervene in the matters of MSEFC. In short Ministry of MSME cannot interfere with judicial functioning of MSEFC.
Q.4 Is filing of Udyog Aadhaar Memorandum (UAM) Mandatory to file applications on MSME Samadhaan Portal?
Ans: Yes, UAM is mandatory to file applications online on MSME Samadhaan Portal.
Q.5 How can I get Udyog Aadhaar Memorandum (UAM) Number ?
Ans: Registration for Udyog Aadhaar can be done online on the official website of Ministry of MSME free of cost at following address : https://udyogaadhaar.gov.in/UA/UAM_Registration.aspx
Q.6 Is it mandatory to file Delayed Payment Applications online on MSME Samadhaan Portal only?
Ans: No. MSME Samadhaan Portal has been created only to facilitate online applications regarding

delayed payments. Physical applications can also be filed at the concerned MSEFC.
Q.7 Who can convert the application into Regular Reference Petition/claim case?
Ans: The applications are converted into case by the concerned MSEFC.
Q.8 If there is no action on an application filed by MSEs, whom to contact?
Ans: After submission, the application is automatically forwarded online to concerned MSEFC. Therefore, concerned MSEFC is to be contacted after filing the application online on MSME Samadhaan Portal. The contact address of concerned MSEFC is mentioned on the acknowledgement sent on the registered email of the applicant.
Q.9 Is work order compulsory to file application on MSME Samadhaan Portal?
Ans : Yes, work order is compulsory. In case purchase order is oral an affidavit to that effect is to be
submitted.


Q.10 How to upload multiple invoices?
Ans: Multiple invoices can be combined into single PDF and can be uploaded. The affidavit of oral purchase order is to be included in single PDF.
Q.11 On which email OTP is sent?
Ans: The OTP is sent to the registered email ID in Udyog Aadhaar.