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LEGAL GLOSSARY · MSME & PAYMENTSWhat Is MSME Samadhaan?
The government online mechanism through which registered MSMEs file applications against buyers for delayed payment, claiming the amount due plus statutory interest.
Gyanendra Singh·Advocate·High Court of Madhya Pradesh, Jabalpur
What Does MSME Samadhaan Mean?
MSME Samadhaan is an online portal (samadhaan.msme.gov.in) operated by the Ministry of MSME. A registered micro or small enterprise facing delayed payment can file an application there against the buyer, claiming the unpaid amount along with the statutory interest payable under the Micro, Small and Medium Enterprise Development Act, 2006.
The portal is the entry point for the recovery route created by the MSMED Act — it does not replace the Facilitation Council process that decides the claim.
How MSME Samadhaan Works
- The buyer must pay on or before the date agreed in the contract, and in no case later than the statutory maximum of 45 days from acceptance (or deemed acceptance) of goods or services.
- If payment is late, interest runs at three times the RBI bank rate, compounded monthly, on the amount outstanding (current bank rate: see rbi.org.in).
- The enterprise registers on the portal using its Udyam Registration number, fills in the application, and uploads supporting documents.
- The application goes to the Micro and Small Enterprises Facilitation Council (MSEFC), which first tries conciliation; if that fails, the dispute proceeds to arbitration before the Council.
- A buyer who wants to challenge the claim must first deposit 75% of the amount claimed, and the Council is expected to dispose of references within 90 days.
- A separate ODR portal (odr.msme.gov.in) offers fully online resolution for qualifying disputes — check the current threshold there.
Who Can Use It
The enterprise must hold a valid Udyam Registration obtained before raising the relevant invoices — verify yours at udyamregistration.gov.in. An unregistered supplier cannot use this mechanism for those dues.
Illustrative Example
Hypothetical scenario for illustration only.
A registered small enterprise supplies components worth ₹8,00,000 to a buyer on 1 June. The buyer neither pays nor objects within 45 days. The supplier sends a written demand citing the MSMED Act, waits the stated period, then files a Samadhaan application claiming the principal plus interest at three times the RBI bank rate from day 46 onwards, uploading the invoice, delivery challans, email confirmations and the demand notice.
If the buyer contests the claim, it must deposit 75% of the amount with the Council before its objection is heard — a provision that pushes many disputes toward early settlement.
MSME Samadhaan: Common Questions
1. Who can file on MSME Samadhaan?
A supplier holding valid Udyam Registration who has supplied goods or rendered services to a buyer and has not been paid within the contractual date or the statutory maximum period. Registration status is checked against the Udyam database during filing.
2. What can be claimed in a Samadhaan application?
The principal amount left unpaid, together with compound interest at three times the Reserve Bank of India's notified bank rate calculated from the date the payment became due until realisation. The claim should also state the basis: invoice value, dates and the buyer's default.
3. Is going to court still necessary after filing?
No. Once the application is filed, the Facilitation Council handles the matter — first attempting conciliation, and proceeding to arbitration if the parties do not settle. Court becomes relevant only later, for executing the Council's award if the buyer still does not pay.
4. Can the buyer simply deny the claim?
Not without cost. To contest the supplier's application, the buyer must first deposit 75% of the amount claimed. If it succeeds, the deposit is returned with interest; if not, the amount goes toward the supplier's claim.
5. How long does the process take?
The MSMED Act directs the Facilitation Council to dispose of references within 90 days. Practical timelines depend on the buyer's cooperation, whether conciliation succeeds and the council's schedule.
6. What documents should I keep ready?
Your Udyam Registration certificate, the invoice(s), the purchase order or contract, proof of delivery or completion, correspondence showing the buyer accepted the supply, any part-payments received, and the written demand notice sent to the buyer.
Sources: MSME Samadhaan Portal (samadhaan.msme.gov.in) · MSMED Act, 2006 (indiacode.nic.in) · Udyam Registration (udyamregistration.gov.in)
Facing a Delayed Payment From a Buyer?
Get your invoices, registration status and demand notice reviewed before you file.
Contact Gyanendra Singh →Disclaimer: This explanation covers MSME Samadhaan in general terms and is not legal advice. Eligibility rules, thresholds and procedures change; verify current requirements on the official portals or consult a qualified advocate about your specific matter.