You have followed up, sent the polite reminders, even drafted a legal notice, and a client is still sitting on an invoice that is now 90 days overdue. What most freelancers never learn is that if they are Udyam-registered, there is a government enforcement portal built specifically for this exact situation, one that does not require a lawyer, a court filing fee, or years of litigation, and it comes with an interest penalty structure most clients genuinely do not want to find out about.
Here is how the MSME Samadhaan portal actually works, what it takes to use it, and the real numbers on how often it actually gets you paid.
Samadhaan exists specifically for delayed payment to a registered micro or small enterprise
Under Sections 15 and 16 of the Micro, Small and Medium Enterprises Development Act, 2006, a buyer must pay a registered micro or small supplier within 45 days of accepting goods or services, and if they don't, the supplier can file a complaint directly with their state's Micro and Small Enterprises Facilitation Council through the MSME Samadhaan portal. This is a statutory right, not a negotiation tactic, and it exists specifically because the law recognized that small suppliers have little leverage to collect from larger buyers through normal means.
The only prerequisite is Udyam registration, which is free and takes a few minutes online. See the guide on GST vs Udyam registration for freelancers in India for how to get registered if you haven't already, since Samadhaan is simply not available to you without it.
The interest penalty is compound, not simple, and it is steep
Once a payment is overdue past 45 days, the buyer owes interest at three times the RBI's bank rate, compounded monthly, not a flat annual percentage the way most people assume a "late payment penalty" works. At current bank rates, this works out to roughly 16 to 17 percent annually, but compounded monthly rather than simple interest, which meaningfully increases the real cost to the buyer the longer they delay, and is specifically designed to make sitting on a small supplier's payment a genuinely bad financial decision, not just an inconvenience.
This interest accrues automatically under the law, you do not need to have stated it in your invoice or contract beforehand for it to apply once a Samadhaan complaint is filed.
How the process actually works, step by step
File your complaint on the samadhaan.msme.gov.in portal with your Udyam number, invoice details, and proof of delivery or completion of the work. The complaint goes to the relevant state's MSEFC, which notifies the buyer and can conduct conciliation first, essentially a mediated settlement attempt, before moving to arbitration if that fails. Unlike a civil court case, this process is designed to run faster and without mandatory legal representation on either side.
This sits as an escalation step beyond a standard legal notice, not a replacement for one. See the guide on sending a legal notice for an unpaid invoice for the step that typically comes first, since many disputes resolve at that stage without needing to go further.
Being honest about the real odds, not just the entitlement
The legal right is real, but the practical outcome is mixed, and genuinely worth being honest about rather than oversold. Government figures put total applications filed since the portal's launch well into the hundreds of thousands, but independent reporting on disposal rates has repeatedly found that only a modest share of filed cases actually reach a settlement or a final MSEFC ruling at any given time, since conciliation and arbitration both take real time and a buyer determined to delay can still draw the process out considerably. Filing a complaint is a strong, legitimate escalation step, not a guaranteed or fast resolution, and you should go in expecting a real possibility of a long wait, not a quick payout.
The realistic use case is as leverage: many buyers settle once they realize a formal complaint is actually being filed and understand the compound interest exposure, rather than letting the full process run its course, which means the mere act of filing often accomplishes more than waiting for a final ruling.
Keeping the documentation that makes a complaint credible
Rinto keeps your invoices, their status, and how long each has been outstanding in one organized record, which is exactly the documentation a Samadhaan complaint needs to establish both the overdue amount and the exact date the 45-day window started.
Need cash before the due date instead of chasing? See invoice discounting through TReDS.
Frequently Asked Questions
What is the MSME Samadhaan portal and who can use it?
Samadhaan is a government portal that lets a Udyam-registered micro or small enterprise file a formal complaint against a buyer who has not paid within 45 days of accepting goods or services, under Sections 15 and 16 of the MSMED Act, 2006. The complaint goes to the relevant state's Micro and Small Enterprises Facilitation Council, which handles conciliation and arbitration without requiring mandatory legal representation. Udyam registration is the only prerequisite, and it's free to obtain.
How much interest does a client owe on a payment overdue past 45 days?
Three times the RBI's bank rate, compounded monthly, not simple annual interest. At current rates this works out to roughly 16 to 17 percent a year, but the monthly compounding meaningfully increases the real cost the longer a buyer delays. This interest applies automatically under the MSMED Act once a complaint is filed, regardless of whether it was stated in the original invoice or contract.
Do I need a lawyer to file an MSME Samadhaan complaint?
No, the process is specifically designed to not require mandatory legal representation, which is a meaningful difference from a standard civil court case. File directly through the samadhaan.msme.gov.in portal with your Udyam registration number, invoice details, and proof of delivery or completed work.
How likely is a Samadhaan complaint to actually get me paid?
Mixed, and worth going in with realistic expectations. Independent reporting on disposal rates has repeatedly found that only a modest share of filed cases reach a final settlement or ruling at any given time, since conciliation and arbitration both take real time and a determined buyer can draw the process out. That said, in practice many buyers settle once a complaint is actually filed and they understand the compound interest exposure, which means filing often works as effective leverage even before any final ruling is reached.
Should I file a Samadhaan complaint immediately or try other steps first?
A standard escalation sequence, polite reminders followed by a formal legal notice, resolves many disputes without needing to go further, and is worth trying first. Samadhaan is a stronger, statutory escalation step once those earlier steps have genuinely failed and the invoice is past the 45-day window, since it carries a real compound-interest penalty and a formal government process the buyer cannot simply ignore the way they might ignore an email.