The article below explores how traders can avail Udyog and Udyam Schemes to reap government-provided benefits. Read further to know more about this!
Small and medium-sized enterprises (SMEs) or businesses contribute to about 70% of the nation’s GDP, only second to agriculture. It promulgates small capital in block and district levels, as well as state and national levels too. One cannot dismiss the impressive amounts of goods produced and services amassed by these micromanaged businesses, in the country every year. More frequently than not, the government adjusts and plans its schemes to uphold and propel efficacious management of MSMEs and consolidate their grounds and business investment returns too, through governmental aid and perks. It allows access to the growth of the business or multiple businesses an individual or party is willing to handle.
Udyog Aadhar Scheme
One of the most important and successfully popular MSMEs sector schemes (among businessmen, and think tanks economists of the country), that are known how to manage the development and manufacturing output, is the Udyog Aadhar scheme. It is essentially a unique identification number (or memorandum too, sometimes, whichever one applies for) just like Aadhar, but exclusively for business and ownership. It is of great help for more visibility of the enterprise, its investment and turnover transparency, tax/ return filing, and easy accessibility of both government and business to each other.
Udyog Aadhar- Purpose and Mechanism
Talking about the development of the scheme and the motivation behind it, the main idea of the Udyog Aadhar looking to be an official facilitator, source of support, and a body that prefers businesses registered with the government to non-registered ones.
It is a way of making businesses streamlined and hence more organized, this way the availing and choosing of the registered businesses for goods and service transaction purposes becomes easier.
What’s more is that by enabling the growth of these small and medium enterprises, a better, more thorough, and adept employment drive can be provided to the ever-increasing number of unemployed youth, and prevent the receding of the economy:
- Encouraging their business (one or multiple) growths with allowances and funding perks
- Offering subsidy rates, concessions, interest rebates, tax exemption, and payment delay protection against buyers.
- The government facilitates the small, medium, and micro enterprises to enjoy business loans without worrying to have to produce collateral or worry about mortgages.
- Make loans less intimidating by exempting taxes up to 20 lakh rupees.
Is Udyam Registration available for traders too now?
At first, SME registration wasn’t particularly or exclusively available for traders, there was no registration procedure for traders under the Ministry of Micro, Small, Medium-sized enterprises. However, not very long back, the government has decided to make the Udyam Scheme platform more inclusive of its traders’ base. There is a NIC code for the same. But of late, the government (on 2nd July 2021) has finally considered the trade businesses of retail and wholesale as micro, small or medium enterprise and thus given it a place of getting registered with the center under MSME, thus getting enrolled in Udyam Registration.
Who are Retail and Wholesale traders?
Wholesale traders are people who deal with bulk amounts of a particular item, (generally maintain a degree of specificity in the collection of items sold) the variety is limited, but they sell goods from factory and production sites at fairly lesser prices than available market values of the same. This helps increase profit margins while selling goods to retailers, professional or commercial users, and other links to the consumer world.
Retailers deal with a very wide variety of products, (non-specific majorly) but limited quantities of each, they buy from wholesalers to profit off a good margin while selling it to consumers and professional or industrial users. They are the link between the wholesale markets and consumers.
Udyog/ Udyam Schemes for Traders:
Under the new improvised additions and improvements in the increasingly inclusive Udyog and Udyam schemes of MSME, introduced by the government, it is believed to be well-intentioned and in favour of over 2.5 million wholesale and retail traders of India.
The benefits, reaped by the traders, have stayed true to the nature of Udyog/ Udyam schemes:
- Cheap and easy bank loans
- Small capital and tax rebates
- Preference by the government through the small business act
- Assist, counsel, and protect the interests of trade businesses, and
- extend small funding under the Aatmanirbhar Bharat Scheme.
How to register for Udyam (for Traders) in MSME schemes:
Like most self-certifying and detail-providing forms on government portals, this too is not at all complicated and quick. Here is a step-by-step guide:
Step 1: One should first visit the official government site and go to the Udyam Registration Portal: https://msme.gov.in/
Step 2: Some self-certifying details are asked about the business which the owner or the applicant would need to provide, like name/ business/ type of business
Step 3: Details about the wholesale/ retail shop owner could be asked for, as well, and should be provided, PAN card, Aadhar Number, and Phone number linked to Aadhar.
Step 4: After submitting, the details shall be checked and verified by an appointed executive and any discrepancy in data detected, would be conveyed to the applicant for revision and re-entry.
Step 5: Once confirmed and submitted, the trader shall receive the Udyam certificate at the mentioned address.
Documentation required for Traders to enroll in Udyam
As mentioned, very little is demanded while filling registration forms that register the wholesale or retail trade – MSMEs schemes like Udyog Aadhar or Udyam.
- Permanent Account Number of owner
- Unique ID Aadhar Card Number
- Phone number linked to Aadhar and Bank Account.
Benefits of Traders Registering in MSMEs schemes:
- The disorderly mismanagement of retail and wholesale markets will be corrected and systemic help will be resorted to, be it for loans and outstanding debts
- Commercial banks should, under this scheme and guidelines of priority sectors, for traders, extend up to 40% non-bank credit or credit equivalent to weaker sections
- Concessions in loans
- No mortgage
- Lesser rates of interests
- Protection against pay delay of buyer
- Government preference
NIC (National Industrial Classification code) for Wholesale and Retail
Code NIC 45- wholesale and retail trade as well as repair of motor vehicles and motorcycles
Code NIC 46909– Non-specific wholesale trades, Motorcycle repair, Trade retail moto vehicles. (Division 46– wholesale trade except motor vehicles/ motorcycles; group 469-non-specialized wholesale trade, class 4690– non-specialised wholesale trade; sub-class 46909-other non-specialised trade)
Code NIC 47– Retail trade, (but not of motor vehicles and motorcycles)
Code NIC 2008 – 4711- for Retail small businesses, in non-specialized stores mostly food/ confectionary/ drinks or beverages, etc
Conclusion
The inclusivity of the traders in wholesale and retail is a great plus for the government as well as the people. It tends to benefit the consumer world when such businesses pick ground, availability increases, scarcity is overcome and employment increases by small numbers in every search unit, with even slight growths in business. With such encouragement, financial and additional cost-effective perks, and little funding, the traders are believed to work towards making the most of the substantiated gains under the said schemes, for both themselves and the country.
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