The MSME (Micro, Small and Medium Enterprises) sector is one of the fastest growing segments of the Indian economy. It plays a key role in driving inclusive growth as well as job creation in the country. Keeping that in mind, the Union Government has come up with several schemes to boost this sector and create more opportunities for entrepreneurs. One such scheme is PME-SMeCo – an initiative that aims to support micro enterprises, small enterprises, and microenterprises by providing them with easy access to financing, business services, and market opportunities. With so many government schemes coming up exclusively for MSMEs, it’s high time you register your business as a Micro, Small or Medium enterprise. In this article we will explain if an Aadhaar Card is mandatory for MSME Registration and what you need to know before registering your company as an MSME.
What is an MSME?
MSME stands for Micro, Small and Medium Enterprises. It is an economic activity which has a production threshold of less than 10 million INR. The Micro enterprises have a threshold less than INR 1 crore, Small enterprises have a production threshold less than INR 5 crore, and Medium enterprises have a production threshold between INR 10 crore to INR 100 crore. The MSMEs are responsible for a bulk of the Indian economy and need to be supported and encouraged to create more jobs as well as contribute to the growth of the nation. This is why the government has come up with various schemes that help MSMEs get easy access to finance, business services, and market opportunities.
What Documents are Required for MSME Registration?
While registering as a Micro, Small or a Medium Enterprise, you will have to provide the following details – – Owners/Partners details (Name, Age, Residential Address, Passport copy etc.) – Name of the business (including its activities) – Business Address (Place of Registration) – In case you are applying online, you will need an Aadhaar Number as well. Apart from the above details, you will also have to provide the details about the ownership structure of the business as well as the financial structure. You may also be required to submit audited financial statements as well. The registration process is not complicated and can be completed within a few hours once you have collected the required documents.
Aadhaar Card Mandatory for MSME Registration
During the registration process, you will be required to submit your Aadhaar card details. While the Supreme Court has given an interim order saying that an Aadhaar card is not mandatory, it is a must while registering your MSME. The government has made it mandatory to submit your Aadhaar card details as it is an effective way of identifying the person. However, the Aadhaar details will only be used for the purpose of registration and will not be stored or used for any other process.
When to register under the Micro, Small and Medium Enterprises Act?
The government has specified a threshold of INR 10 lakh for micro enterprises, INR 5 crore for small enterprises, and INR 50 crore for a medium enterprise. If your company’s annual turnover is less than INR 10 lakh, then you will be registered as a micro enterprise. If the annual turnover of your business is between INR 10 lakh and INR 5 crore, then you will be registered as a small enterprise. If the annual turnover of your business is more than INR 5 crore, then you will be registered as a medium enterprise. Keep in mind that this is a threshold that your business must meet in a year. So if your company’s annual turnover is INR 10 lakh this year, it doesn’t mean that it will be a micro enterprise next year as well. Your company will have to maintain the turnover below the threshold every year.
Conclusion
In this article, we have explained if an Aadhaar Card is mandatory for MSME Registration. We have also explained what you need to know before registering your company as an MSME. We have also discussed the benefits of registering your business as an MSME. Next time, you have to register your business, don’t forget to carry your Aadhaar card with you!