Page 30 - Banking Finance July 2020

ARTICLE

in the process. Now It is a voluntary registration based on a Y NIC Code - These registrations are location specific and
self-declaration, for running unit not for upcoming units. The the applicant must mention National Industrial
registration is simplified and the Ministry of MSME has Classification Code (NIC Code). Each location is allotted
introduced an online one page Udyog Aadhaar a code number which can be taken from National
memorandum. Industrial Classification Handbook.
Y Person employed - The total number of people employed
Institutions engaged in financing the MSME sector had
in the business.
recommended the universalization of the registration. Thus,
the concept of ease of registration was originated such that Y Investment in Plant Machinery / Equipment - Amount
MSME's are able to avail the benefits under various Schemes of money invested in terms of machinery and equipment
of Central/ State governments. by the business.
Y DIC - Details of the District Industry Center nearest to
Documents and Information Required for Online Udyog
the business, if required.
Aadhaar Registration: (https://www.msmeregistration.org,
https://msmeudyogaadhaar.in, https://udyogaadhaar.gov.in)
Benefits to MSMEs:
Y Aadhaar Number of an applicant - Only a natural person
can apply on the behalf of a business. Y The two percent interest subvention will reduce the cost
of the borrowing of the MSMEs, which will translate
Y Details of the applicant
into profitability of the MSMEs.
Y Name -The applicant name as mentioned on the
Y Formalizing of the MSME will increase number of
Aadhaar Card issued by UIDAI.
MSMEs under tax net, which improve the tax collection
Y Social category- Whether applicant fall in General/ to government.
Scheduled Caste/ Scheduled Tribe/ Other Backward
Caste has to be specified along with the documentary Y Formalizing of MSMEs will help the financing institution
proof of the same as required by the concerned for better credit appraisal and decision making while
authority. extending loans to MSMEs.
Y Name of Enterprise- An applicant can do more than one Y Formalizing of MSMEs improve the scope for digital
business in different names. A person may carry on lending by the fintech companies.
multiple business activities at one time or may become
a partner or director in more than one firm or company Conclusion:
respectively. Support and Outreach Initiative for Micro, Small and
Y Form of Business- An applicant has to specifically select Medium Enterprises (MSMEs), Govt. of India has taken a
the form in which the business is being carried on. slew of measures to augment growth. Despite
Different forms of business can be a Proprietorship, many initiates through schemes and programs, benefits are
Partnership, Limited Liability partnership( LLP), not reaching the unorganized MSMEs. It is an initiative of
Company Registration etc. the GOI, announcing 2% interest subvention Scheme of
Y Address of the business MSMEs, where registration with GSTN (Goods and Service
Tax Network) and obtaining of Udyog Aadhaar are
Y Date of Commencement of businesses.
mandatory.
Y Previous Registration Details - If a business already
registered as MSME is filing for Udyog Aadhaar Number
This will help in formalizing of economy while extending
then it must provide details of previous registration in incentives to MSMEs. Formalizing of MSMEs may pave a path
the application form.
for digital lending to cater the needs of small borrowers.
Y Bank Details. Currently this scheme is implanted through Scheduled
Y Major Activity - Nature of activity of the business is to Commercial Banks only and NBFC are not covered, which
be provided along with the code specified for it. are aggressive in lending to MSMEs. R

30 | 2020 | JULY | BANKING FINANCE