MSME means Micro, Small and Medium Enterprises 2. The MSME is classified into 2 sections, namely, the manufacturing section and also the service section. Manufacturing Enterprises are those who are engaged in the manufacture or production of products. Service Enterprises are those that are engaged in providing or rendering of services and are defined in terms of investment in equipment.
Interest rates on loans are lower after MSME 2 is registered, almost as low as 1%-1.5%, which is proved to be way lower than the normal interest rate. The government launched the Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGS) to provide collateral-free credit to the MSE sector. New enterprises, as well as, existing enterprises are eligible to be covered under the scheme. Legislative and statutory support is given to the MSME like Reservation, among others.
Registered MSMEs are eligible for reimbursement of expenses for ISO Certification by applying to the appropriate authority. The enterprises registered under MSME enjoy the protection against delayed payments whereby the various provisions are made to ensure the payment by the buyer. Being employed in an MSME will prove to be a source of income and livelihood for the women of socially and economically backward classes.