Similarity between MSME and SSI: Meaning, Benefits & Role

In order to know if MSME and SSI are the same or not, it is important to find the similarity between MSME and SSI.


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    Similarity between MSME and SSI

    Similarity between MSME and SSI

    Industries are usually classified between small-scale, medium scale and large-scale units based on their size, available capital, and labor force. Recently, all micro, small, and medium-sized businesses have been grouped together under the umbrella term “Micro, Small, and Medium Enterprises” (MSMEs). 

    A small-scale industry is one that relies heavily on hired labor to run it. In order to know if MSME and SSI are the same or not, it is important to find the similarity between MSME and SSI.

    In this article, you will understand the concepts of MSME and SSI. Additionally, you will learn more about the similarity between MSME and SSI.

    What is the meaning of MSME?

    Since the Micro, Small, and Medium Enterprises Development (MSMED) Act of 2006 was passed, small and medium-sized businesses have been defined explicitly as Micro, Small, and Medium Enterprises (MSME). These businesses mainly manufacture and provide services for goods and commodities.

    Micro, small, and medium enterprises are divided into three categories. They are-

    • Micro Enterprises
    • Small EnterprisesMedium  Enterprises The investment ceiling for the various sectors are stated in the following table-

    A) For the Manufacturing Sector-

    Type of EnterpriseInvestment in Plant and Machinery 
    Micro EnterpriseUp to Rs. 25 Lakhs
    Small EnterpriseBetween Rs. 25 lakhs to Rs. 5 crores
    Medium EnterpriseBetween Rs. 5 crores to Rs. 10 crores

    B) For the Service Sector-

    Type of EnterpriseInvestment Limit
    Micro Enterpriseup to Rs. 10 Lakhs
    Small EnterpriseBetween Rs. 10 lakhs to Rs. 2 crores
    Medium EnterpriseBetween Rs. 2 crores to Rs. 5 crores

    Meaning of SSI?

    Small-scale industries (SSI) are a type of business that produces goods or provides services using a few laborers and workers, as well as relatively more modest machines. Currently, Small Scale Industries have been particularly classified under the MSMED Act, based on the amount of investment in plant and manufacture of small-scale sector firms and investment in equipment for the service industry. 

    The engagements outline the restrictions on investment in small-scale industries:

    • Investment limits for the manufacturing industries must range between 25 lakh and 5 crores.
    • For service sectors, investments must range between 10 lakh and 2 crores.

    MSME and SSI are the same things?

    Yes, MSME and SSI are the same things. In the past, small-scale industries produced goods and offered services to the small sector, earning them SSI registration. However, the MSMED Act was passed and small-scale industries were included in the Act.  Hence, MSME and SSI are the same.

    The similarity between MSME and SSI is that the service sector and manufacturing industries are present in both MSME and SSI. The SSI, however, uses very few tools and personnel to produce things or render services.

    Revision of the MSMED Act

    Since the MSME and SSI are the same under the MSMED Act, therefore, as per the latest revision of the Micro, Small and Medium Enterprise Development Act(MSMED), the following changes have been made-

    Types of IndustryInvestment in Plant and MachineryService Turnover
    Micro EnterpriseRs.1 crores.Should not exceed Rs.5crores
    Small Scale EnterpriseRs.10 crores.Should not exceed Rs.100 crores
    Medium EnterpriseRs.50 crores.Should not exceed Rs.250 crores

    Role played by MSME and SSI in India

    Since there is a lot of similarity between MSME and SSI, they perform similar roles. 

    The role played by MSME and SSI in the Indian economy are:

    1. Employment Generation Since MSME and SSI are the same, they are labor-intensive and create a tonne of job opportunities. The nation’s employment rate is rising significantly.
    2. Fair distribution of income Since SSI and MSME have greater employment potential than major sectors, there has been a fairer distribution of wealth and income across the country as a result.
    3. Capital Mobilization and Entrepreneurial Abilities Entrepreneurship prospects are abundant for MSME and SSI and hence they have access to a good amount of savings.  Latent resources and abilities can be used to generate business concepts that can be implemented with little investment.As a result, these industries are mobilizing a sizable amount of latent resources for the nation’s industrial growth.
    4. Effective decisions- Due to the organization’s modest size, decisions may be made quickly and effectively without involving a big number of individuals, as is the case with large organizations. As such, appropriate, fresh business prospects can be seized.
    5. Regional Industry Dispersal- the MSME and SSI are spreading the manufacturing units throughout the country which promotes a balanced structure of industrial growth across the nation.
    6. Improved Labor Relationsanother similarity between MSME and SSI is that they have similar roles which is to improve the labor relations between the employers and employees. It aids in reducing the number of labor disputes.

    Benefits of MSME and SSI registration

    Since MSME and SSI are the same and under the Indian Government, getting registered under MSME and SSI has a lot of advantages. Any business, whether it is a small scale or MSME can register under the MSMED Act,2006 to take advantage of the government’s programs and subsidies.

    • After registering, receiving a 50% subsidy on a trademark or patent is feasible.
    • Obtaining government contracts, as well as a variety of business licenses and permits
    • The Industrial Promotion Subsidy can be accessed after registration.
    • Enterprises that get themselves registered under the MSMED Act can avail of subsidy on electricity payments from the respective department.
    • One similarity between MSME and SSI registration is that it helps its members by getting lower interest rates.
    • It can assist in obtaining ISO Certification remuneration.
    • The enterprises registered are exempt from filing returns.

    Documents Needed to Register an MSME and an SSI

    Since there is a similarity between MSME and SSI, therefore the documents needed for their registration are almost the same. 

    The following list includes the few crucial documents needed for MSME and SSI registration:

    • PAN and Aadhar Card of the registrant.
    • Address proof
    • Enterprise name
    • Registrants bank details
    • Starting date of the industry
    • Nature of the industry
    • Employee numbers
    • Investment amount


    The article mentioned above explains in detail the meaning of MSME and SSI. It also  shows the similarity between MSME and SSI.

    If you have any additional queries regarding the similarity between MSME and SSI, you can consult Odint Consultancy. We will help you solve your queries.


    MSME registration is crucial for fostering accountability and transparency in the case of small firms.

    Yes, MSME and SSI are the same things. Small-scale firms were categorized under the MSMED Act based on the amount of investment in the manufacturing and service sector.

    The MSMEs Ministry issues the SSI/MSME registration for small and micro firms. To apply for SSI/MSME registration, you can visit the Udyam Registration portal online. The PAN card and the Aadhaar card are the basic requirements for SSI registration.