The E Shram card, also referred to as the Udyog Aadhaar Memorandum is a distinctive 12-digit identifier designated for micro and small enterprises within India. Initiated by the Ministry of Micro, Small and Medium Enterprises, its purpose is to simplify the registration procedure and offer numerous advantages to small business proprietors.
Beyond being a registration certificate for MSEs, the E Shram card opens doors to a range of advantages. These include simplified access to credit, subsidies, and various government schemes, all aimed at strengthening and supporting small businesses. In this blog, we shall see the eligibility for E Shram card.
Understanding Role of E Shram Card
The E Shram Card, also referred to as the Universal Account Number, is a distinct 12-digit identification code designated for each employee participating in India’s Employees’ Provident Fund initiative.This card serves as a singular point of reference for an employee’s EPF account, offering access to vital account details, including EPF balance, passbook downloads, and other relevant information.
Additionally, the E Shram Card streamlines the transfer of EPF account balances between jobs, eliminating the necessity for an employee to manage multiple EPF accounts. For eligibility for E Shram card, an employee must work within an organisation with over 20 employees, earn a monthly wage below Rs.15,000, and hold Indian citizenship while being employed within India.
What is the Eligibility for E Shram Card in India?
The E Shram Card is available to specific categories of employees in India based on certain eligibility criteria. The eligibility for E Shram card is as follows:
1. Employees in Organisations with Over 20 Employees
Employees working in organisations with a staff count exceeding 20 are eligible to acquire an E Shram Card.
2. Employees Earning a Monthly Wage Below Rs.15,000
Employees who earn a monthly wage less than Rs.15,000 are eligible to apply for an E Shram Card.
3. Indian Citizen Employees Working in India
Indian citizens employed within the country are eligible to obtain an E Shram Card.
It’s important to emphasise that all employees eligible for the Employees’ Provident Fund scheme have automatic eligibility for E Shram card.
Special Cases Regarding Eligibility
1. Organisations with Less Than 20 Employees
Organisations with a workforce of less than 20 employees are not mandated to enrol their employees in the EPF scheme. However, if employees from such organisations opt to enrol in the EPF scheme, they can also obtain an E Shram Card.
2. Employees Earning Above Rs.15,000 per Month
Employees earning a monthly wage exceeding Rs.15,000 do not qualify for eligibility for E Shram card. Nevertheless, they may still be eligible for other social security schemes such as the Employees’ Pension Scheme and the Employees’ Deposit Linked Insurance Scheme.
3. Non-Resident Indian Employees
NRI employees working within India have the opportunity to acquire an E Shram Card. However, NRIs employed abroad are ineligible for the EPF scheme and, consequently, not eligible to obtain an E Shram Card.
Eligibility for E Shram Card For Enterprises
The eligibility for E Shram card for enterprises is based on certain factors as have been mentioned below:
1. Type of Enterprise
The enterprise must fall under the classification of a micro, small, or medium-sized enterprise (MSME) as per the definitions provided by the MSME Act of 2006.
2. Nature of Business
The enterprise should be involved in the activities of manufacturing, production, processing, preservation of goods, or provision of services.
3. Ownership
The enterprise can possess the following ownership structures: proprietorship, partnership firm, limited liability partnership, cooperative society, Hindu Undivided Family (HUF), or a private limited company.
4. Investment
The investment in plant and machinery or equipment for manufacturing enterprises, as well as the investment in equipment for service enterprises, must align with the limits specified for MSME registration by the MSME Act of 2006.
5. Turnover
The annual turnover of the enterprise should not exceed the limits prescribed as per the MSME Act of 2006.
Subsidies and Advantages for E Shram Card Holders
The possession of an E Shram card offers Micro and Small Enterprises a range of subsidies and benefits, as mentioned below:
1. Access to Credit
E Shram card holders can effortlessly access credit from banks and financial institutions, leveraging the card as a registration certificate for MSEs.
2. Subsidies
E Shram card holders qualify for diverse subsidies provided by the government for MSEs, including schemes such as the Prime Minister’s Employment Scheme and the Credit Linked Capital Subsidy Scheme.
3. Government Schemes
E Shram card holders have the opportunity to benefit from various government schemes like the Technology Upgradation Fund Scheme and the Market Development Assistance Scheme.
4. Tax Benefits
E Shram card holders are entitled to tax benefits in accordance with the MSME Act, 2006. These benefits encompass priority sector lending, duty concessions, and simplified compliance with government regulations.
5. Marketing Support
E Shram card holders can access marketing support from the government, including participation in trade fairs and exhibitions, along with access to market trend information and consumer preferences.
6. Technical Assistance
E Shram card holders can avail technical assistance from the government, involving access to training programs and consultancy services. These resources aid in enhancing the efficiency and competitiveness of their enterprises.
Final Thoughts
The eligibility for E Shram card serves as a vital tool for Micro and Small Enterprises, granting them access to a range of substantial advantages. These include facilitated credit access from financial institutions, eligibility for government subsidies such as the Prime Minister’s Employment Scheme, and participation in significant government schemes like the Technology Upgradation Fund Scheme.
Moreover, tax benefits under the MSME Act, 2006, including priority sector lending and duty concessions, are extended to card holders. Additionally, the E Shram card provides avenues for marketing support, enabling MSEs to partake in trade fairs, gain insights into market trends, and benefit from consumer preference data. Furthermore, technical assistance in the form of training programs and consultancy services is accessible, ultimately enhancing the efficiency and competitiveness of MSEs.
