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MSME Samadhaan: How to Recover Delayed Payments Legally
Buyer not paying your invoice on time? Micro and small suppliers have a legal route for delayed payments, and it starts with the right paperwork.
Under the MSMED Act, 2006, a buyer must pay a micro or small supplier within a fixed time. When they do not, you can file a case, and since 15 October 2025 that means the MSME ODR portal. GRO-MSME helps you understand your position, organise your proof and prepare the case.
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GRO-MSME provides advisory, document assessment and coordination support. It is not a law firm and does not guarantee recovery; outcomes depend on the facts of each case and the applicable law. This page is general information, not legal advice.
What Is MSME Samadhaan?
MSME Samadhaan is the Ministry of MSME’s system for delayed payments to micro and small enterprises with a valid Udyam Registration. Under the MSMED Act, 2006, a buyer must pay within the agreed period and never later than 45 days from acceptance of the goods or services. After that, the buyer owes compound interest at three times the RBI bank rate. Since 15 October 2025, new delayed payment cases are filed on the MSME ODR portal and heard by the state’s MSE Facilitation Council (MSEFC).
How Much Interest Can a Late Payment Attract? Try the Estimator
Enter your invoice, the acceptance date and payment terms to see the due date, days overdue and the interest a buyer may owe under Section 16.
Tell Us About Your Unpaid Invoice
Share the buyer, invoice and the amount pending. GRO-MSME will call you back to review your position and the documents you hold.
- Free call back from GRO-MSME experts
- Eligibility check and document guidance
- Support from application to follow-up
Prefer to talk? +91-9811312259
Delayed Payment Rules at a Glance
Maximum payment period under Section 15 of the MSMED Act, 2006, from acceptance or deemed acceptance of goods or services (15 days if there is no written agreement)
Compound interest with monthly rests that the buyer owes on the delayed amount (Section 16); the RBI bank rate is 5.50%, so the rate is 16.5% a year at present
Time within which the Act requires each reference to the MSE Facilitation Council to be decided (Section 18)
Sources: MSME Samadhaan portal, the MSMED Act, 2006 (PDF) and the RBI (bank rate as at 18 September 2026).
How to File a Delayed Payment Case: Step by Step
This is the usual route from an unpaid invoice to a decision. Exact screens on the portal can change, so use this as a map.
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Check that you qualify
You must be a micro or small enterprise with a valid Udyam Registration, and the buyer must have accepted goods or services you supplied. Medium enterprises are not covered by this route.
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Work out the payment due date
Count from the day the goods or services were accepted: 15 days if there is no written agreement, or the agreed period, which cannot exceed 45 days. Anything beyond that is delay.
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Send a reminder and a formal notice
A written reminder followed by a formal notice records your demand and often brings the buyer to the table. Keep proof of delivery.
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Gather your documents
Udyam certificate, invoices, purchase orders or agreement, delivery and acceptance proof, ledger extract and copies of your reminders. Use the checklist below.
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File the application on the MSME ODR portal
Log in with your Udyam details and mobile or email OTP, enter buyer, invoice and amount details, upload documents and submit. You receive an acknowledgement.
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Conciliation, then arbitration
The MSE Facilitation Council first tries conciliation. If that fails, the dispute goes to arbitration under the Arbitration and Conciliation Act, 1996. The Act expects a decision within 90 days of the reference.
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Award and recovery
The award carries the principal and interest. A buyer who challenges it in court has to deposit 75% of the awarded amount first (Section 19).
MSME Samadhaan vs MSME ODR Portal: What Changed?
If you read an older article, this table shows where it may be out of date.
| Question | Before 15 October 2025 | From 15 October 2025 |
|---|---|---|
| Where do I file a new case? | MSME Samadhaan portal | MSME ODR portal (odr.msme.gov.in) |
| What happens to old cases? | Tracked on Samadhaan | Samadhaan continues to show status of existing cases |
| Who can file? | Micro and small enterprises with Udyam Registration | Same: micro and small enterprises with Udyam Registration |
| Legal basis | MSMED Act, 2006 (Sections 15 to 18) | Same: MSMED Act, 2006 |
| Who decides? | MSE Facilitation Council of the state | Same: MSE Facilitation Council, with digital case handling |
Source: notice on the MSME Samadhaan home page. Confirm the latest position on the portal.
Documents to Keep Ready
A complete file is the single biggest help. Tick what you already have.
0 of 8 ready
Common Mistakes That Weaken a Delayed Payment Claim
Registering after the order
Courts have looked at whether the supplier was registered as a micro or small enterprise when the contract was made. Check your Udyam date against your order date and take legal advice if they differ.
No proof of acceptance
Without a signed copy, email or goods receipt, the buyer can dispute when the 45 days began.
Ignoring quality disputes
If the buyer raised quality complaints, keep the correspondence and your replies. An undocumented dispute is hard to answer later.
Wrong buyer details
A mismatch in the buyer’s name, GST number or address across documents can delay the case.
Waiting too long
Records fade and relationships sour. Sending a formal notice early keeps options open.
Using one rate for a long delay
Interest follows the RBI bank rate as notified from time to time. Ask for the calculation to be checked before you claim.
Delayed Payment: Which Recovery Route Fits?
The ODR portal is not the only route. This table shows how the common routes differ.
| Route | Best suited when | Things to know |
|---|---|---|
| Reminders and a legal notice | The buyer is reachable and the amount is clear | Often the first step; keeps a record of your demand |
| MSME ODR portal / MSEFC | You are a micro or small supplier with a valid Udyam Registration and the buyer has crossed the payment limit | The Act requires a decision within 90 days of the reference |
| Cheque dishonour complaint (Section 138, Negotiable Instruments Act) | The buyer paid with a cheque that bounced | Strict time limits run from the date of the bank’s return memo |
| Civil suit | Other routes do not resolve the dispute | Usually slower and costlier; needs a lawyer |
General information only. Time limits and procedure depend on your facts; take legal advice before choosing a route.
Why Buyers Have a Reason to Pay on Time
Section 43B(h) of the Income-tax Act links a buyer’s deduction for purchases from micro and small enterprises to payment within the limits in the MSMED Act. Interest paid on delayed payments is also not deductible. Buyers that know this often prefer to settle rather than face a case. It is a tax matter for the buyer, so confirm the details with a chartered accountant.
How GRO-MSME Helps You With a Delayed Payment Case
We work on the practical side of the case. Where a legal opinion or representation is needed, we coordinate with a qualified legal professional.
Check your position
We review invoices, orders, delivery proof and correspondence against the payment rules, and check your Udyam status and dates.
Build the case file
We help you organise proof, work out the amount and interest, and prepare a clear file before you go to the portal.
Choose the right route
We explain each route in plain language and coordinate with a legal professional where needed.
Who Should Use This Service?
Micro Enterprises
Owed by larger buyers
Small Enterprises
Receivables past 45 days
Manufacturers
Component and material suppliers
Traders
Businesses selling on credit
Contractors
Held up by main contractors
Service Providers
IT, logistics, professional services
Startups
Young suppliers with thin reserves
MSME Owners
Anyone unsure of their rights
Related GRO-MSME Services
MSME Samadhaan and Delayed Payment: Frequently Asked Questions
Is MSME Samadhaan still where I file a delayed payment case?
No. The MSME Samadhaan portal now asks suppliers to file all new delayed payment applications on the MSME ODR portal (odr.msme.gov.in). Samadhaan continues to show the status of existing cases.
What is the time limit for paying an MSME supplier?
Under Section 15 of the MSMED Act, 2006, the buyer must pay by the date agreed in writing, and that agreed period cannot exceed 45 days from acceptance or deemed acceptance of the goods or services. If there is no written agreement, payment is due within 15 days.
Who can file a delayed payment case?
A micro or small enterprise with a valid Udyam Registration can file against a buyer for delayed payment for goods supplied or services rendered. Medium enterprises are not covered by this route.
How much interest can a delayed payment attract?
The buyer is liable to pay compound interest with monthly rests on the unpaid amount at three times the bank rate notified by the RBI (Section 16). With the bank rate at 5.50%, that is 16.5% a year at present. The exact amount depends on the delay and the rate in force.
What documents do I need to file a delayed payment case?
Usually the Udyam certificate, invoices, purchase orders or agreement, proof of delivery or acceptance, a ledger or statement of the amount due, and copies of reminders or notices sent to the buyer. GRO-MSME reviews your set before you file.
Where is the case heard and how long does it take?
The case goes to the MSE Facilitation Council of your state, which first attempts conciliation and then arbitration. The Act requires each reference to be decided within 90 days of the reference, although actual time depends on the case.
Does a delayed payment affect the buyer’s income tax deduction?
Section 43B(h) of the Income-tax Act links a buyer’s deduction for purchases from micro and small enterprises to payment within the limits in the MSMED Act. This is a tax matter for the buyer; confirm details with a chartered accountant.
Does GRO-MSME recover the money for me?
No. GRO-MSME provides advisory, document assessment and coordination support. It is not a law firm or collection agency and cannot guarantee recovery. Where legal representation is needed, we help you connect with a qualified professional.
Don’t Let a Stuck Payment Stall Your Business
Tell us about the invoice, the buyer and how long it has been pending. Aapka Payment, Aapka Haq — talk to GRO-MSME.
- Free call back from GRO-MSME experts
- Eligibility check and document guidance
- Support from application to follow-up
Prefer to talk? +91-9811312259