Being one of the fastest developing economies in the world, India is becoming an attractive choice for business opportunities and investments for manufacturing of goods as well as offering services. Further, its favourable geographical location as well as the large size of the population have led it to become one of the biggest markets for production and consumption purposes which is further expected to increase manifold in coming years. According to a study made by the Boston consulting group, Indian markets are likely to turn into the third largest consumer market by year 2025 with a consumption amounting nearly to four trillion dollars by year 2025.

MSMEs mean the Micro, Small and Medium Enterprises under which smaller business units are classified and thereafter governed under provisions of MSME Act 2006. They have been known as “the backbone of Indian economy” for their contribution in the Indian economy. MSMEs have served various socio-economic purposes such as creating employment opportunities, promotion of industrialisation in remote backward areas, revival as well as preservation of traditional art and culture, harmonizing regional disparities, to offer MSMEs assistance for better accessing domestic as well as export business markets, providing support to business development, encouraging innovation and upgradation of technology & infrastructure in the economy along with bringing modernization in the industrial sector.

Accordingly, MSMEs contribution has been growing significantly towards the socio-economic development of the country and is further expected to grow in near future. At present, the total MSME contribution in the GDP of the country is around 29% and the sole contributor for 50% of the exports in the country. MSMEs have a one-third share in country’s total manufacturing output and have employed around 11 crore individuals which has been targeted to reach 15 crores in the coming years.

Realising the importance of MSMEs for the growth of Faridabad, Haryana economy, the Government of India introduced “MSME Registration” to further promote growth and provide growth opportunities through financial aid and guidance. On registration, the small scale units registered as MSME shall get various benefits and incentives offered by the Central and State/UT Governments to get registered as a MSME. Further Banking and Tax laws have expressly prescribed the word ”MSME” to allow exemption under the laws.

How have MSME units been categorized under the provisions of MSME Act 2006?

MSMEs have been categorized as Micro, Small and Medium enterprises under the Act which is determined by the amount of investments and annual turnover of the enterprise which was earlier dependent on the amount invested in equipment’s and P&M. As per the revised definition, the definition of MSMEs is provided below-

Business enterprises undertaking manufacturing or provision of services shall be defined as MSME where-

S. No. Type of Unit Investment in P &M Annual Turnover
i. Micro Enterprise Up to Rs. One crore Up to Rs. Five crores
ii. Small Enterprise Up to Rs. Ten Crore Up to Fifty crores
iii. Medium Enterprise Up to Fifty crores Up to two hundred fifty crores.

Udyam Registration for MSMEs in Faridabad, Haryana

Situated on the northern part of the country adjacent to Delhi this state is supported by its major geographical features i.e. Shivallik hills towards the North-East, the Aravalli hills in the South, semi-deserted sandy plain in the South-West and the remaining part occupied by the Yamuna Ghaggra plains.

Ranking no. 3 on the Export Preparedness Index 2020 under the landlocked category of states. Haryana has a thick network of road-rail connectivity, with over 1,630 km of rail network and 26,131 km of road linkage, inclusive of 24 National Highways (NH). Further it has 5 civil and 2 international airports to support its infrastructure. The total installed power capacity of 11,268 MW is the lifeline of all the manufacturing units based here.

Haryana is a hub to India’s biggest automobile industry and is the leading producer of motorcycles and passengers in the country. It holds a gigantic share of 33% in the manufacturing of two wheelers, 50% in the cars production, 52% in the crane manufacturing segment and a total of 80% of the excavators are made here. Due to this back and forth stimulation received from the Government supplementary policies and varied segments from the automotive industry 50 of the 250 large sized OEM’s are placed in Haryana.

It has also evolved as a main station for the biotechnology, Information Technology (IT) and the knowledge industry resulting to total exports of electronics and IT during 2016-17 valued $7.2 bn, which accounts to 6.2% of the aggregate of exports from IT and electronics from India. Gurugram, the business capital of Haryana is a home to 50% of the Fortune 500 companies. And thus it holds the highest concentration of the total BPO workforce of the entire world.

Conventionally Haryana was the pivot of agro production and still it continues to prosper being the largest producer of many horticulture crops like carrot, radish, cucumber and strawberries. It has continued to be the principal producer of Basmati rice in the country and exports the surplus produce.

The colossal progression of the state is due to the privilege this state enjoys and that is it falls under two major corridors of the country, one is Amritsar Kolkata Industrial Corridor (AKIC) and the other is Delhi Mumbai Industrial Corridor (DMIC). Moreover, 13 districts of Haryana get covered under prominent trade and consumption center of the country i.e. National Capital Region (NCR).

Investment opportunities in Haryana value nearly $672.12 bn, comprising of 467 projects out of which 5 are private and 462 are Government owned projects, with 114 promoters, spread across 23 districts which makes Haryana a lucrative choice among investors in the commercial segment

Therefore, the Udyam registration or MSME registration in Faridabad, Haryana is the process of undertaking registration of the above mentioned small scale units to offer maximum benefits and incentives to all the categories of business enterprises in a simple, quick but efficient way.

The process of registration in Faridabad, Haryana is voluntary and not compulsory to obtain by any individual proprietor or any business enterprise. However, registration under the Act allows the business enterprise to become eligible to avail benefits allowed by the Central Government such as easy access to bank funds, lesser rates of interest, exemption under direct & indirect tax laws subsidies in capital investments etc. and many more.

Prior to the MSME registration or Udyam Registration (the new portal), the Government of India had launched Udyog Aadhaar Registration with the objective to boost small scale businesses in Faridabad, Haryana. Under which, the applicant had to go through a long process of filling forms namely, Entrepreneur Memorandum-I and Entrepreneur Memorandum-II (EM-II), involving a lot of paper work. Thus, to encourage more and smaller scale enterprises to avail benefits offered by the scheme, the Government of India launched Udyog Aadhaar Memorandum (UAM) system for MSME registration by filling the gaps in the earlier system.

Thus, Udyam Registration form is the form through which an online request is placed for MSME registration on the MSME portal provided by the Ministry of Micro, Small & Medium Enterprises, under which the details related to the enterprise as well as the employer or proprietor are provided who are then verified and on successful submission of the application, an acknowledgement number is issued that contains a unique UAN (Udyog Aadhaar Number).

Currently, those business proprietors or business enterprises who already possess Udyog Aadhaar Registration need to compulsorily migrate to the UAM by the 31.12.2021, otherwise they will not be eligible to avail UAM benefits. And those who have not been registered under Udyog Aadhaar Registration previously need to get themselves registered under Udyam portal for obtaining MSME registration benefits.

Udyam Registration

Online process of Udyam or MSME Registration in Faridabad, Haryana

First of all, there is no prohibition on any form of legal entity to get itself registered as a micro, small or even a medium enterprise in Faridabad, Haryana, if it meets the investment and annual turnover criteria. Thus, any of the following legal entity may apply for Udyam registration in Faridabad, Haryana-

  • A Sole Proprietorship firm
  • Partnership Firm/ Limited Liability Partnership
  • A Company (Private Limited/Limited/OPC)
  • Hindu Undivided Family (HUF)
  • Trust /Society/Co-operative Society
  • Any others business entity

Provided below is the step-by –step process of Udyam registration in Faridabad, Haryana on the MSME portal-

  • Open the MSME portal by logging on to https://msme.gov.in/
  • Click “Online MSME Registration”
  • There are two categories of registration for enterprises provided under Udyam portal for business enterprises including-
  1. Businesses who do not have been registered as MSME yet or hold Entrepreneurship Memorandum-II;
  2. Businesses who were earlier holding Udyog Aadhaar Memorandum (UAM).

Registration under category 1

  • The applicant proprietor (in case of proprietorship Form) and any authorized officer in case of any other business entity) needs to put his name and the unique Aadhaar identification number granted by the Government of Faridabad, Haryana along with the registered mobile number for OTP generation purposes.
  • Once OTP authentication process is completed, the applicant needs to submit details related to the Type of the business organization and PAN number of the concerned business and further validate the same by clicking “PAN validation” after which the provided PAN shall be matched with the business organization from the Government database. Once it is verified, the applicant can move forward with the application.
  • After this, the applicant needs to submit remaining application details such as registered address of the business enterprise in Faridabad, Haryana, branch details (if any), GST identification number, ITR details, bank account details, Initial capital & investment in the business, total no. of employees hired by the organization, details of products or services being offered by the business entity as per the National Industrial Classification (NIC) code, investment made in P&M by the business entity etc.
  • On filling all these details, the applicant shall be required to verify all the details once and then click “Submit & Final OTP” on the Udyam registration portal. On successful submission of which an acknowledgement number shall be generated for future reference.
  • On receipt of the application form, the Ministry of MSME will go through the application and on being satisfied of the requirements of the Act, may issue a registration certificate which could be downloaded from the portal in pdf form containing a unique Udyam Registration number.

Registration under Category 2

  • Business enterprises who have already been registered under the previous registration system and possess Udyog Aadhaar Memorandum, need just to click ““Business enterprises possessing UAM” as provided under the Udyam Registration Portal for registration purposes.
  • On clicking the option, the applicant will find a page with an option seeking his/her Udyog Aadhaar Number and receive an OTP in the email id and mobile number provided previously for UAM registration. Obtain an OTP, on the mobile number and email provided under UAM.
  • Next, the applicant will find an option namely, “Validate and Generate OTP” option for final submission, after submitting which the process of registration will get completed and thus, the applicant will be granted Udyam Registration certificate.

Documents Required for Udyam Registration in Faridabad, Haryana

Provided below is the list of documents required for Udyam Registration in Faridabad, Haryana-

  • Details related to name of the entrepreneur and the Aadhaar registration number for OTP generation pruposes;
  • PAN details of the business enterprise;
  • Scanned copy of utility bills (Electricity /water bills)
  • GST Certificate if obtained by the business enterprise;
  • ITR details (if filed by the business entity for the previous year);
  • Registered address of the business enterprise along with any branch;
  • Bank Account Details of the business
  • Copy of proof of ownership of property where the registered office of the business is either located or proposed to be located in. (i.e. sale deed/rent agreement/lease agreement)
  • Constitution of business related documents (MOA & AOA in case of company, LLP Deed in case of LLP etc.)
  • List of goods or services proposed to be manufactured or provisions of services or both undertaken by the business entity as per the National Industrial Code.

Benefits of Udyam Registration

What are the Benefits of Udyog Aadhaar Registration in Faridabad, Haryana?

As mentioned before, business entities who obtain Udyam Registration in Faridabad, Haryana become eligible to avail the following benefits-

  • Electricity Bills Concessions – Businesses entities holding MSME registration in Faridabad, Haryana are allowed concessions in electricity bills on an application made to the electricity department in the concerned State Department in consonance with the MSME department.
  • Overdraft interest exemptions– MSMEs in Faridabad, Haryana ordinarily deal with insufficiency of funds, thus, to make them stress-free from financial woes, MSMEs can seek up to 1 % interest reduction for overdraft facilities provided by the banks.
  • Easy Bank Loans– Considering the common problem related to insufficiency of funds, the Government of Faridabad, Haryana along with the Small Industries Development Bank of Faridabad, Haryana (SIDBI) has introduced Credit Guarantee Fund Scheme (CGS) to offer collateral –free loans to MSMEs for making them stress-free of arranging collaterals for stressed MSME in Faridabad, Haryana.
  • Concession in Patent Registrations –For the purpose of encouraging IPR registrations especially in smaller enterprises, the Government of Faridabad, Haryana has allowed up to 50% exemption in the applicable patent registration fees during the process of application.
  • ISO certification reimbursements – MSME registered enterprises in Faridabad, Haryana are eligible to seek reimbursement for the expenses incurred in the process of ISO certification with respect to goods or services offered by the MSME.
  • Tax Exemptions –MSMEs in Faridabad, Haryana have been provided incentives in the form of tax exemptions and other similar benefits under various laws such as direct tax, Excise law and banking regulations subject to the level of business activity of the concerned MSME.
  • Market assistance and Export Promotion in Faridabad, Haryana: For encouraging MSMEs to export their goods and expand their business on a global level, the Government of Faridabad, Haryana organizes various events and programs such as industrial fairs, exhibitions and expos, exchange programs and trade fairs in Faridabad, Haryana for MSMEs and also allows Also, such MSMEs exporting their goods to foreign countries incentives for exports by way of payment subsidies, tax exemptions and technical support.
  • Protection against Delayed Payments – MSMEs are started with lower capital and generally struggle with insufficiency of funds for further business purposes. To ensure that the MSME businesses do not suffer payment defaults from any buyer, they have been allowed protection against delayed payments as per the provisions of MSMED Act 2006. Thus, any buyer who owes money to any entity registered as MSME needs to make payment either within 15 days from the date of acceptance of goods and services any such date shall not exceed a period of forty-five days from the date of deemed acceptance. Where the buyer fails to make payment within forty-five days from the date of acceptance or deemed acceptance of goods or services, he/she shall be required to make payments along with a penal interest rate that could go up to three times of the bank rate notified by the RBI.

Are there any disadvantages of MSME registration in Faridabad, Haryana?

Following are some disadvantages of MSME registration in Faridabad, Haryana-

  • Higher Rates of Interest– Due to limited capital and resources for business, MSMEs in Faridabad, Haryana generally need to take loans from banks & financial institutions. Further, in the early stages of the business they often struggle with loan repayments which makes it difficult to manage their business operations and the interests keep on pilling up one after another with time.
  • Tedious Loan application procedure –Though, the MSME Ministry has simplified the procedure to obtain loans for businesses, but the process is complex involving various documents submission and fillings to establish the capability to repay of the concerned business.
  • Reliability on Credit Score –Though MSMEs have been allowed loans from banks and financial institutions which require either partial or no collateral for funds. For which, MSMEs need to establish the business credibility or capability to repay loans dependent on their credit score .Therefore, an enterprise possessing lower credit score has lesser chances to access loans easily from banks or financial institutions.
  • Other Problems – Despite all encouragement and incentives from the Government of Faridabad, Haryana, most of the MSMEs are unable to compete with larger corporations due to problems like underdeveloped infrastructure, lesser resources, shortage of skilled employees, lesser innovation and reliance on traditional methods etc. have led to undergrowth of MSMEs in Faridabad, Haryana especially in backward areas.
  • Overcrowding – In recent years large number of MSMEs have been registered in Faridabad, Haryana, but the same has led to intense competition to avail schemes offered by the Government of Faridabad, Haryana, which makes it difficult for some MSMEs to stand and thrive in difficult circumstances.

What government schemes could be availed by MSMEs in Faridabad, Haryana?

Considering the importance of the MSMEs in the development and the upliftment of the Faridabad, Haryanan economy, the central government has devised various schemes in consonance with the Reserve Bank of Faridabad, Haryana, which includes-

  • MSME Samadhaan Scheme
  • Udyog Aadhaar Registration
  • ZED Scheme
  • Make in Faridabad, Haryana scheme
  • Stand up Faridabad, Haryana.

Conclusion

Therefore, MSME registration in Faridabad, Haryana has gained importance in modern Faridabad, Haryana for its socio-economic development and at the same time much importance is being given to smaller scale industries with innovative ideas and technology. Thus, if you are someone who has a creative and innovative idea in mind, start your entrepreneurial journey in Faridabad, Haryana today along with MSME registration to avail benefit from various government schemes.