Micro, Small, and Medium-Sized Enterprises, or MSME Udyam Registration, is the primary government agency responsible for managing and creating policies, regulations, and legislation pertaining to India’s small-scale manufacturing sector. The MSME (Micro, Small and Medium Enterprises) programme went into operation on October 2, 2006, and it was created to help the MSME grow and improve its competitiveness.
MSMEs are seen as being essential to the Indian economy since they are a key component of the industrialization of rural and underdeveloped areas. MSME Registration is obtained in accordance with the MSMED Act, 2006, and it is not required to get MSME Registration in India; nonetheless, it must be taken into account that entities or organisations having MSME Registration are able to take advantage of numerous programmes and advantages.
The difference between the manufacturing and service sectors was eliminated, the investment limits were revised, and a turnover criterion was added in May 2020, when the Indian Finance Minister, Mrs. Nirmala Sitharaman, introduced a new amendment to the definition of MSME.
According to the updated MSME definition, any class or classes of businesses are included, regardless of their name, including proprietorships, Hindu Undivided Families (HUF), associations of people, partnership firms, co-operative societies, and companies/undertakings. The following describes how companies are categorised under the MSME Acts:
Note: Previously, the MSME Registration only applied to the service and manufacturing sectors. However, the Government of India declared in July 2021 that, with the exception of motor vehicles and motorcycles, the Retail & Wholesale Trade would fall under the MSME Classification and be eligible to apply for MSME Registration. Therefore, the registration is applicable to and open to applications from the manufacturing, service, and wholesale/retail sectors of the economy.
Also read: Can Udyam Registration Be Done Without Aadhar?
What advantages do MSME Udyam registrations in India offer?
The advantages of MSME udyam registration in India include the following:
- Any business that is registered as an MSME can borrow money from banks at a rate that is roughly 1- 1.5% lower. This is significantly less than the standard bank rates;
- MSMEs are eligible for a number of tax exemptions and rebates;
- MAT (Minimum Alternate Tax) credit may be carried forward by MSMEs for a maximum of 15 years, which is typically 10 years;
- Only industries registered under the MSME Act are eligible for different bids;
- MSME is granted easy financing by a number of financial institutions;
- Industries registered under the MSME Act are granted more advantage over other industries;
- Companies or sectors with an MSME Udyam Certificate have stronger growth prospects since they have direct access to important national and international trade fairs and have more options to market themselves;
- MSMEs are eligible for collateral-free loans since banks do not require collateral for loans up to Rs. 10 lakhs;
- industries registered as MSME are eligible for reimbursement of ISO certification;
Who may submit an MSME Udyam Registration application in India?
The list of those that are qualified to apply for MSME Registration in India is as follows:
Any organisation can register as an MSME in India, including Hindu Undivided Families (HUF), Limited Companies, Proprietorships, LLPs or Limited Liability Partnerships, One Person Companies (OPCs), Any Association of Persons’ Partnership Firms, Co-operative Societies, and any other business.
Documents Needed in India to Register an MSME
For MSME Udyog Aadhar Registration, the only necessary papers are a PAN card and an Aadhaar card. There is no need for paper evidence because registration is done totally online. The online Udhyam Registration Portal, which is fully connected with the Income Tax & GSTIN System, would automatically obtain PAN & GST associated facts on investment & turnover of firms from the Government databases.
The following information must be included in the application form:
Aadhar number, name of business owner as it appears on Aadhar card, kind of organisation (private or public limited company, LLP, proprietorship, HUF, co-operative society, partnership firm, society, or trust, for example), and
PAN Card, Gender, Business Office Address, Bank Account Number, and IFSC Code;
the number of workers;
investment amount in plant and equipment (entrepreneurs can enter 0 if there is no investment in plant and equipment);
Turnover; Plant or unit location;
societal classifications like OBC, General, SC, or ST;
Date that a business first opened for business or when an enterprise registered; NIC code for the main activity; Business activity of an enterprise.
How to register your business for MSME Udyam online
Through Udyam Registration, a government-based portal integrated with the GSTIN and Income Tax systems, the applicant can apply for MSME Registration. Businesses outside the scope of the GST Law are not required to register for GST. However, in order to obtain Udyam Registration, businesses that are subject to the GST Regime must first obtain GST Registration.
By submitting an application on the Udyam website, one can obtain the MSME Registration. And the portal will not collect any fees in exchange for providing such a registration;
Afterward, a confirmation message with the application’s reference number will show up on your screen;
The msme, the ministry of commerce will issue the msme certification or udyam registration certificate to the applicant’s mail id after completing the verification formalities. After two to three days from the date the application was submit. The MSME will grant the MSME Registration. The certificate is valid forever and does not require renewal.
The certificate may be downloaded by the applicant through the account they have set up on the Udyam Registration website.
Read more: Forgot Udyog Aadhar Number
Important Things to Bear in Mind:
It is necessary to re-register on the Udyam Registration Portal. By choosing the option “For New Entrepreneurs who are not yet register. As MSME/those with EM-II” after obtaining UAM Registration or any other registration approve by any authority under the MSME.
Enterprises or businesses with UAM Registration must switch to Udyam Registration by June 30, 2022. The UAM Registration would be invalid and the businesses won’t be able to take advantage of the incentives offer to MSMEs if they don’t convert to Udyam Registration by this date.
Validity of MSME Udyam Registration Certificate
The MSME Certificate is grant for a lifetime as long as the categorization requirements. Are satisfy and is valid for as long as the business is in existence.
One of the top websites for government registration and licencing services is Udyam Advisors. No matter how many regulations and compliance requirements there are under different acts. We make sure that our clients receive top-notch services.