The Micro, Small, and Medium Enterprises (MSMEs) market in India is growing. In fact, there are over 63 million MSMEs in the country! But there is a loan gap of ₹25 trillion in the sector. Also, the debt demand of Indian MSMEs is ₹69.3 trillion. Moreover, it’s growing at 11.5% CAGR (Compound Annual Growth Rate).

So, to grow MSMEs, the Indian government launched Udyam Registration, offering various benefits to MSMEs. For instance, it offers collateral-free loans. In this blog, we’ll explore Udyam Registration and how it can help Indian MSMEs in India. Let’s begin!

Udyam Registration – Overview

Udyam is an online system launched by the Union MSME Ministry on July 1, 2020. The government also gave the name “Udyam” to all MSMEs. Since its launch, around 169 lakh MSMEs have registered through the Udyam portal.

Benefits of Udyam registration

Businesses that register for Udyam can reap many benefits. Here are some of them:

• Banks offer collateral-free, subsidized, low-interest loans to MSMEs. In fact, these loans come under priority sector lending. In other words, MSMEs are part of inclusive finance.
• It’s easier to get licenses and approvals.
• Your firm can get special considerations for trade with other nations.
• You can gain concessions on certain bills, such as electricity bills.
• Your firm can apply for the Credit Linked Capital Subsidy Scheme.
• The government reimburses ISO certification fees.
• You can get protection against late payments.
• Production or manufacturing MSMEs can get special reservation policies.
• You don’t need to pay direct tax.
• You can get subsidies for:
  
  • Barcode registration
  • Patent registration
  • NSIC (National Small Industries Corporation) performance fees
  • Credit rating

Eligibility for Udyam registration

To register for Udyam, your firm must have a certain amount of investment and turnover. Here’s a table that shows the eligibility criteria for a firm to be MSME:

Thus, before you register for Udyam, make sure you’re eligible.

Udyam Registration – How to register?

You must register with Udyam to get its benefits. The following is a brief overview of the process and prerequisites:

Prerequisites for Udyam registration

You don’t need physical documents to register for Udyam. To start with, you must give your Aadhaar number if you’re:

• the owner of a proprietorship firm
• the managing partner for a partnership firm
• the ‘karta’ for a HUF (Hindu Undivided Family)

The government has linked the Udyam portal to the following:

1. Income Tax system
2. GST identification system
3. Government e-marketplace

So, when you give your Aadhaar details, the portal gets your investment and turnover details from the government databases.

But the organization or its authorized signatory must give its GSTIN (Goods and Services Tax Identification Number) and PAN (Permanent Account Number), along with the Aadhaar number for a:

• Company
• Limited Liability Partnership
• Cooperative Society
• Society or Trust

To sum up, you must have your PAN, GSTIN, and Aadhaar before you register for Udyam.

Additionally, as a business, you must also submit the following details to register for Udyam:

• Bank account details
• Business address
• Details of business activities, along with office or production units
• Investment information (plant, equipment, and machinery)
• Turnover information
• Duplicate bills of sales and purchases
• Partnership deed (if applicable)
• NIC code (National Industrial Classification Code)
• Copies of the bill and license of the machinery
• Details of the applicant (name, mobile number, and email address)
• Details about whether registering as a manufacturer, service provider or both
• Certificate of disability (if applicable)
• Miscellaneous information (the number of employees and social category with the required certificate)

Note: Giving false or misleading information while you sign up for or update Udyam is punishable under Section 27, MSME Development Act, 2006. Thus, ensure all the information you submit is accurate.

Process for Udyam registration

When you register for Udyam, you won’t have to pay fees. Moreover, you can register your firm through a simple online process. The process is based on self-declaration and does not need renewal.

Here is the step-by-step guide for registering for Udyam:

1. Visit the Udyam registration website: https://Udyamregistration.gov.in/.
2. Select the “For New Enterprise who are not Registered yet as MSME” tab.
3. Enter your Aadhaar number and name.
4. Enter the OTP (One Time Password) sent to your mobile number to validate them.
5. Fill out all the details in the form as it prompts.
6. Check if they’re correct before you submit them.
7. Enter the OTP sent to your mobile number to validate your Udyam registration form.
8. You will get a “Thank You” message on your mobile number and email ID. Also, this message will have your Udyam registration number.
9. Download and print your Udyam Registration Certificate.

Your Udyam Registration certificate has a QR code. Using the code, you can access the following:

• the registration portal’s web page
• your firm’s information

You can only apply for one Udyam Registration for your firm. But you can list many different business activities under that same registration.

Wrapping up

We are optimistic that after reading the blog, you have all the information you need about Udyam registration for MSMEs.

Without a doubt, it helps MSMEs get many benefits. For example, they can get collateral-free loans. Moreover, they can get subsidized or low-interest loans. Also, they can get the licenses they need to operate efficiently. They’re also protected from delayed payments.

However, to register, firms must first meet the MSME criteria. Moreover, the online process doesn’t require paperwork and is easy to follow. But if you have questions about your business’s eligibility for Udyam or the process, you can seek guidance from GJM & Co. Our experienced professionals will help you understand its benefits, the type of company your business falls under, and also help you register for it.

Should you have any queries or need consultation, Schedule a Call today or write to us at info@gjmco.in.