MSME Registration
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Introduction
What is MSME/Udyam Registration?
MSME/Udyam registration is an initiative by the Government of India to give legal and operational identity to micro, small, and medium businesses in India. Udyam registration was previously known as MSME registration or Udyog Aadhar registration and is governed by the MSME (Micro, Small, and Medium Enterprise) Development Act, 2006. In 2020, the registration process was changed from Udyog Aadhar registration to Udyam registration in order to simplify the registration process and help businesses accelerate growth. The entire process is online and based on self-declaration. All registered businesses can take the benefits granted under the MSME scheme. This includes many financial benefits such as easy loan facilities, hassle-free registrations, additional edge in Government Tenders, protection against delayed payments, etc.
Eligibility Criteria for MSME/Udyam Registration
The business entities that fall under the following three categories can apply for MSME Registration /Udyam registration online.
Micro Enterprises: Businesses whose investment in plant and machinery is not more than ₹1 crore and the annual turnover is not more than ₹5 crores.
Small Enterprises: Entities whose investment in plant and machinery is not more than ₹10 crores and the annual turnover is not more than ₹50 crores.
Medium Enterprises: Businesses whose investment in plant and machinery is not more than ₹50 crores and the annual turnover is not more than ₹250 crores.
Benefits
Why should you obtain Udyam/MSME Registration for your business?
Easy Loan Facility
In the past small and medium-sized businesses have faced various hurdles while trying to get loans from banks. However, udyam registered businesses can get easy and collateral-free loans from banks and financial institutions. Additionally, loans are offered at a subsidized rate of interest to MSME registered businesses.
Rebate on TM and Patent application
Government fees on Trademark applications for entities such as Companies, Partnership firms, and LLPs are higher compared to individual and proprietorship firms. These entities may claim a 50% rebate on the Government fees by submitting an MSME registration certificate. Similarly, a rebate is prescribed in Patent registration also.
Hassle-free Registrations
Businesses with Udyam/MSME registration are granted hassle-free registrations/licenses with government tender work and financial agencies. Additionally, they are also eligible for subsidized rates for other government registrations. For example, ISO certification is granted free of cost to all Udyam registered businesses. They are also eligible for a subsidized rate for barcode registration, etc.
Concession rate on various utility bills
Businesses are granted concessions on utility bills such as electricity bills, water bills, gas bills, etc. This is particularly helpful for businesses involved in manufacturing. In certain situations, registered businesses are also eligible for rebates on their electricity bill.
Process
Process To Get MSME Registration
Document Checklist
Documents Required for MSME Registration Online
Aadhar Card
A Copy of the proprietor’s Aadhar card or of director(s) or partner(s) in other cases for Udyam Aadhar Registration.
PAN Card
A Copy of PAN card of the business entity; or of individual in case of proprietorship firm.
GSTIN of business
GST Number Certificate issued by the GST Department to a business if applicable.
Bank Account Details
The passbook or Cancelled cheque of the bank account is must.
Proof of Type of Business
Certificate of Incorporation or Registration Certificate mentioning the type of business.
Major Business Activities Proof
Sales Invoices or proforma invoices to know the major activities done by the business.
