Government Schemes for SME

Indian Government Schemes For SME And Its Benefits

In a developing nation like India, a young entrepreneur dreams of expanding his small business. When a young entrepreneur gets to know about the Government schemes for SME that help him/her to receive financial support, training, and access to new markets. 

After registering their business for scheme benefits, the young entrepreneur sees their business grow, and inspires others to get the benefits of these empowering initiatives.

With the help of Indian government schemes for SME, businesses in India can flourish, creating jobs and boosting the local economy. In India, multiple programs have been introduced by the government to support the growth and progress of Micro Small and Medium Enterprises (MSMEs). 

These initiatives aim to offer both financial and non-financial aid to SMEs across diverse sectors of the economy. The Government of India has taken numerous measures and introduced various programs to support Micro, Small, and Medium Enterprises (MSMEs) by introducing government schemes for SME.

Here are some of the notable government schemes for SME:

• Prime Minister Employment Generation Programme (PMEGP)
• Performance and Credit Rating Scheme (PCRS)
• Credit Guarantee Trust Fund for Micro & Small Enterprises (CGTMSE)
• Interest Subsidy Eligibility Certificate (ISEC)
• Science and Technology Scheme
• Market Promotion & Development Scheme (MPDA)
• Revamped Scheme Of Fund for Regeneration Of Traditional Industries (SFURTI)
• Coir Udyami Yojana (CUY)
• Coir Vikas Yojana (CVY)
• Skill Upgradation & Mahila Coir Yojana (MCY)
• Development Of Production Infrastructure (DPI)
• Domestic Market Promotion Scheme
• Export Market Promotion
• Trade and Industry Related Functional Support Services (TIRFSS)
• Financial Support to MSMEs in ZED Certification Scheme
• A Scheme for Promoting Innovation, Rural Industry & Entrepreneurship (ASPIRE)
• Credit Linked Capital Subsidy for Technology Upgradation
• ISO 9000/ISO 14001 Certification Reimbursement
• Marketing Support/Assistance to MSMEs (Bar Code)
• Lean Manufacturing Competitiveness for MSMEs
• Design Clinic for Design Expertise to MSMEs
• Technology and Quality Upgradation Support to MSMEs
• Entrepreneurial and Managerial Development of SMEs through Incubators
• Enabling Manufacturing Sector to be Competitive through QMS&QTT
• Building Awareness on Intellectual Property Rights (IPR)
• International Cooperation
• Marketing Assistance Scheme
• Marketing Assistance & Technology Upgradation (MATU)
• MSME Market Development Assistance (MDA)
• Assistance to Training Institutions (ATI)
• Micro & Small Enterprises Cluster Development (MSE-CDP)
• EDP/MDP schemes
• NER Schemes
• TCSP Schemes

These are examples of the government schemes for SME offered by the Government of India to support MSMEs. The government regularly introduces new schemes and initiatives to support the growth and development of the MSME sector.

In order to access these schemes, businesses need to meet the SMEs classification set by the Government of India, which categorizes MSMEs into the following three groups:

• Micro Enterprises have an annual turnover of up to Rs. 5 crore
• Small Enterprises have an annual turnover ranging from Rs. 5 crore to Rs. 75 crore.
• Medium Enterprises have an annual turnover ranging from Rs. 75 crore to Rs. 250 crore.

It’s important to note that schemes and benefits may vary over time, and it’s advisable to refer to the official websites of the MSME. For the latest information regarding specific schemes and eligibility criteria, consult other relevant government agencies.

Benefits Of Government Schemes For SME

There are several benefits of being certified as an MSME in India. Some of the advantages are mentioned below:

• Collateral-free bank loans: Collateral-free credit is now accessible to all small and micro-business sectors through the Indian Government. This program ensures financial support for enterprises in the micro and small sectors. Both new and existing enterprises are eligible to avail the advantages provided by this initiative.
• Subsidy on Patent Registration: Registered SMEs can take advantage of a 50% subsidy on their patent registration fees by applying to the relevant authority.
• Overdraft Interest Rate Exemption: Registered SMEs can receive a 1% interest rate exemption on OverDraft if their reported turnover qualifies. The specific scheme and its terms may vary from bank to bank.
• Tax Exemption: The Government of India offers different schemes that allow SMEs to benefit from tax exemptions.
• Reservation policies for the manufacturing and production sector: SMEs have the opportunity to benefit from reservation policies specifically designed for the manufacturing and production sector.
• Easy licensing and approvals: SMEs have the advantage of obtaining licensing and approvals effortlessly.
• Special consideration on electricity bills: SMEs have the opportunity to receive special concessions on their electricity bills.
• Protection against Delayed Payments: SMEs have the option to obtain safeguards against payment delays.
• Improved export prospects: Registering as an MSME offers businesses improved export opportunities by providing a safeguard against delayed payments. Such registration showcases a dedication to innovation and progress, affirming the commitment to contribute to the growth of the Indian economy.

Process Of Applying For Government Schemes For SME In India

In order to apply for government schemes for SME in India, businesses need to fulfill the SMEs classification criteria set by the Government of India, which we have discussed previously. Once the classification is met, then businesses become eligible to apply for the schemes offered by the government. 

While the application process may differ for each scheme, businesses typically have the option to apply online or visit the designated offices for the respective schemes. But first, you need to register your business online on the Udyam registration portal.

These are the instructions for applying for government schemes for SME in India:

• Go to the official Udyam registration website, which can be found at https://udyamregistration.gov.in/.
• Complete the personal information section.
• Enter your PAN number.
• Fill out the correspondence details.
• Provide your bank information.
• Complete the section regarding your enterprise details.
• Submit your application and await approval.

To register as an MSME, you need to provide certain documents such as: 

• Aadhar number.
• PAN number.
• Business address. 
• Bank account number.
• Primary business activity. 
• 2-digit NIC code. 
• investment details (including plant/equipment information). 
• turnover details (according to the new MSME definition).
• partnership deed.
• copies of sales and purchase bills.

Please note that every scheme has specific eligibility criteria, an application process, and documentation requirements. Thus, it is important for businesses to thoroughly examine the particular details of each scheme prior to applying. 

Moreover, businesses have the option to obtain support and guidance on the application process and documentation requirements from the dedicated offices of the schemes or from SMEs associations.