Digital India: New portal for MSME registration sees early traction; this many firms register in 2 months

SIDBI had in June set up a Swavalamban Crisis Responsive Fund to help MSMEs onboard the TReDS platform free of cost.

Ease of Doing Business for MSMEs: The MSME registration portal Udyam Registration launched by the government for small businesses to register online and as per the revised MSME definition has already seen nearly 4 lakh registrations, MSME Ministry said on Wednesday. The portal became operational on July 1 and “as on September 1, close to 4.00 lakh registrations have already taken place,” the ministry said in a statement. Apart from new entrepreneurs who want to register their units as MSMEs, businesses which are registered are Entrepreneurs Memorandum (EM) part II or Udyog Aadhaar Memorandum (UAM) can also migrate to Udyam by re-registering themselves. The government had introduced the portal for paperless and free of cost registration of MSMEs based on self-declaration in an effort to boost ease of doing business.

The government has also integrated Udyam with the government’s e-commerce marketplace GeM and platform to facilitate invoice financing – Trade Receivables Discounting System (TReDS). This would allow MSMEs to auction their trade receivables at competitive rates to ease credit challenges as well as sell goods and services to government departments, public sector units etc seamlessly without any additional registration.

Also read: Modi govt says 3/4th of monthly MSME dues cleared in same month; paid this much amount during June-Aug

Importantly, the Reserve Bank of India had recently issued a circular clarifying MSMEs’ doubts around the registration of existing units under EM part II and UAM. RBI had said that existing EMs part II and/or UAMs of MSMEs obtained before June 30, 2020, will continue to remain valid till March 31, 2021. MSMEs had sought clarity whether their existing registrations would remain or valid or not following the government’s June 26, 2020 notification on the classification of MSMEs as per the new definition and specification of the form and procedure for registration with effect from July 1, 2020.

SIDBI had in June set up a Swavalamban Crisis Responsive Fund to help MSMEs onboard the TReDS platform free of cost. The has waived off the joining or registration fees of Rs 10,000 till March 2021 and is targeting to support over 10,000 MSMEs through the fund. Currently, Receivables Exchange of India, M1xchange and Invoicemart are invoice discounting platforms part of the TReDS mechanism.