How to fill MSME Form 1? Step-by-Step Guide

Introduction

MSMEs play a pivotal role in India’s economy, from providing employment to increasing exports and driving industrial growth. With the intention of developing and promoting MSMEs, the Government of India has proposed various schemes and regulations. One of these requirements is to file the MSME Form 1, revealing outstanding payments to MSMEs, by all companies.

The main purpose of MSME Form 1 is that businesses should be timely in payment to MSMEs and the MSME Development Act, 2006. The company needs to provide MSME Form 1 to the Ministry of Corporate Affairs (MCA) if it owes MSME dues for more than 45 days. In addition to this, many MSMEs look for an MSME business loan for necessary cash flows to maintain business activities or to cover late payments.

Also read: decoding-business-loans-what-every-entrepreneur-should-know

How to Fill Out MSME Form 1? Step-by-Step Guide

Step 1: Check Eligibility

Ensure your company is liable to file MSME Form 1. Business establishments required to file MSME Form 1 are as follows:

• Firms with arrears or outstanding payments of more than 45 days to MSME suppliers.
• Firms that availed goods or services from MSMEs and the dues are pending on account for more than the agreed payment period.

Many MSMEs facing delayed payments rely on an unsecured business loan to cover operational expenses and avoid financial instability.

Step 2: Access the MCA Portal

• Portal of the Ministry of Corporate Affairs: mca.gov.in
• Click on the tab of MCA Services and then select E-Forms.
• Search for MSME Form 1 in the list of forms available.

Step 3: Obtain the Form

• Click on the link of the MSME Form 1. This will redirect you to download the latest copy.
• Save that form on the computer and use Adobe Acrobat Reader to open that form.

Step 4: Fill in Company Details

• CIN: Take it from the MCA portal
• The name is as per records of MCA
• Registered Office Address
• Company Email ID
• Phone number.

Step 5: Provide Outstanding Payment Details

• Name of MSME supplier – Mention the registered name of the MSME.
• PAN of the supplier – State the Permanent Account Number of the MSME.
• Amount due – State the total amount outstanding.
• Date from which payment is due – State the date when the payment was originally due.
• Reason for delay in payment – State a valid reason for the delay.

Also read: ready-to-grow-financially-evaluate-your-business-loan-eligibility-today

Step 6: Declaration and Digital Signature

• Insert the name and designation of the authorized person presenting the form.
• Attach the (DIN) Director Identification Number of the person presenting the form.
• Authenticated by a (DSC) Digital Signature Certificate of the person presenting the form. The DSC must be valid and must be registered with MCA.

Step 7: Upload and Submit the Form

• After filling out the form, log into the MCA portal with your credentials.
• Go to the Upload E-Form section.
• Choose MSME Form 1 and upload the digitally signed form.
• Click on Submit and pay the fees if applicable.
• You will get an (SRN) Service Request Number after successful submission. You can use it to check the status of your application.

Step 8: Keep an Acknowledgment Copy

• Download and save the acknowledgment receipt for future reference.
• Keep a copy of the submitted form and payment receipt (if paid) for company records.

Conclusion

This will prove to be very important in keeping businesses engaged in dealing with MSMEs to ensure prompt payment to suppliers with MSME accounts and relieve the financial burden that small-scale business owners might otherwise face. To avoid a non-compliance penalty, MSME Form 1 can easily be filed with such a simple, step-by-step process as stated above. If you have dues pending against MSMEs, you should file the form before the due date so that no legal consequences take place.

NBFCs provide necessary financial assistance to MSMEs. Many MSMEs rely on NBFCs for funding due to streamlined loan processing and relaxed terms. It provides a wide range of financial products, including machinery purchase loans, business expansion loans, invoice financing, etc that support an MSME in maintaining steady fund flow and efficiently meeting its operational needs. The right NBFC can help the MSME grow and sustain in the long term.