Want to start a small business of your own? This is the right time to do so!
The Micro, Small and Medium Enterprises sector or MSME sector has emerged as a key driver of the Indian economy, with countless success stories to tell. Every day, the MSME business list keeps growing.
Today, the MSME sector accounts for over 40% of the country’s GDP and over 40% of India’s exports. What’s more, MSMEs in India also contribute greatly to employment generation, ranking second to agriculture. MSMEs also offer vital support to larger businesses and give rise to a marketplace that fosters innovation, partnership, and collaboration.
To encourage small and medium business owners, the Indian government has launched several initiatives to help the MSME sector grow. MSMEs can gain financial assistance, benefit from tax breaks, and get easier access to markets. So, if you want to learn more about MSMEs and start a venture of your own, this blog is for you.
Read more to learn about which businesses strictly come under the MSME sector and which ones don’t.
Categorisation of the MSME sector
The Indian government’s Ministry of MSMEs is solely responsible for overseeing and enforcing the rules, regulations, and legal frameworks that govern MSMEs.
Based on investment and turnover, the MSME sector is divided into three categories: micro, small, and medium.
S No.
Type of business
The maximum investment (in Rupees)
Maximum Annual turnover (in Rupees)
1
Micro Businesses
1 crore
5 crores
2
Small Businesses
10 crores
50 crores
3
Medium Businesses
50 crore s
250 crores
Classification of MSMEs
MSMEs are broadly classified as manufacturing businesses and service businesses.
As per the Ministry of MSMEs, ‘all business activities – services and manufacturing- are covered in the MSME sector’ as long as they meet the investment and turnover criteria mentioned in the above section.
#1. Manufacturing businesses
Manufacturing businesses consist of enterprises involved in producing tangible goods. These businesses can be small-scale artisan workshops to medium-sized factories as long as they meet the investment and turnover criteria. These businesses can be engaged in:
#1 Fabricating products
#2 Assembling components
#3 Processing raw materials to create finished goods
#2. Service sector businesses
Service businesses or service sector businesses focus on providing intangible services rather than tangible products. These enterprises offer services to other companies, organisations, or individual consumers. Service-based MSMEs include:
#1 Consulting firms
#2 Legal firms and accounting firms
#3 Hospitality services
#4 Healthcare, exercise, and wellness services
#5 Educational institutions
#6 Security services
Government-approved list of MSME businesses
Here is a handy MSME business list for you. These businesses have been approved as MSMEs by the government of India.
#1 Leather goods production- bags, belts, shoes, and wallets
#2 Moulding of items – plastic containers, combs, household goods, umbrella frames, plastic toys, etc.
#3 Natural fragrances and flavours
#4 Consultancy services for job placement and management
#5 Training centres and educational institutions
#6 Energy-efficient pump manufacturing
#7 Xerox, lamination, and other related services
#8 Beauty parlours, salons, and day-care services
#9 Automotive repair services, welding services, and garages
#10 X-ray (X-radiation) clinics
#11 Equipment rental and leasing services
#12 Photography lab solutions
#13 Agricultural farm equipment servicing – tractors, pumps, or ring boring machine
#29 Printing, card-based products, and paper-based products
#30 Coir and jute industry
#31 Furniture and wooden products
#32 Poultry farming
#33 Bicycle parts manufacturing
#34 Stationery item production
#35 Call centre services
#36 Rubber product manufacturing
#37 Information technology solutions – server bank creation, application service provider, smart card customisation, etc.
#38 Testing labs for industries
#39 Auto parts components – horn buttons, door channels, wiper blade components, battery cell tester
#40 Ceramics and glass products – roofing tiles, glass flooring tiles, granite, etc.
#41 Retail and wholesale business operations
If your business falls under this MSME business list, you can register your company on the Udyam portal of the Indian government using the NIC (National Industrial Classification) code.
List of non-MSME businesses
As per the MSMED (Micro, Small, and Medium Enterprises Development) Act 2006, these businesses do not come under the MSME list of companies. So, if your company falls under this non-MSME business list, you will not be eligible for the benefits offered by the government.
#1. Gambling companies and betting ventures
#2. Forestry and timber harvesting
#3. Fishing and aquaculture businesses
#4. Motorcycle trade and repair
#5. Retail trade (excluding vehicles and motorcycles)
#6. Activities of households employing domestic personnel
#7. Goods and services produced by private households for personal use
#8. Activities of extraterritorial organisations and bodies
Unlock MSME business opportunities with Tata Capital’s MSME loan
The Indian government is keen on supporting emerging businesses with benefits and subsidies. So, if your business comes under the MSME business list, register your company on the Udyam portal. More than two crore businesses are registered on the Udyam portal, generating employment opportunities supporting the county’s development.
Did our MSME business list spark an idea in your mind? Well, if you are considering starting a business in the MSME sector, Tata Capital is here to help. Our easy and paperless online application process ensures a quick business loan approval, and you can choose a repayment tenure that suits your needs. So, take the first step towards your business dream and apply for a business loan with Tata Capital today.
31 July 2024
5 mins read
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