Retail and wholesale businesses were subject to the MSME Development Act 2006 until it was scrapped on the recommendations of a committee in 2017.
“The government has received various representations and it has been decided to include retail and wholesale businesses as MSMEs, and they are allowed to register on the Udyam registration portal. However, the benefits for retail and wholesale MSMEs should be limited to priority sector loans, ”according to an official statement.
Impact on small retailers and wholesalers
This decision will have an immediate impact on small retailers and wholesalers with businesses up to Rs 250 crore in turnover by benefiting from short-term financing under various programs announced under the “Atmanirbhar Bharat program. “, according to official sources.
The revised guidelines will benefit retail and wholesale traders by 2.5 crore. This decision would also allow them to register on the Udyam portal.
Retailers and wholesalers will now be able to register on the MSME Centre’s Udyam portal, which was introduced in 2015 as a simplified one-page registration form.
The benefits of getting a Udyam registration include access to cheaper bank loans, tax cuts, and preference for government tenders.
How Traders Can Benefit From MSME Programs
Describing the Center’s decision as “revolutionary,” industry bodies said on Friday that the decision would help formalize the sector.
In addition to accessing loans from the priority sector of banks, retail and wholesale enterprises can take advantage of other programs for MSMEs.
Under the priority sector rules, commercial banks must extend 40% of the adjusted nonbank credit or credit equivalent amount of off-balance sheet exposure to agriculture, MSMEs and weaker sections. Of the total, 7.5% must go to small businesses.
(With contributions from agencies)