In the last few years, the Government of India has initiated various schemes for the development and growth of Micro, Small, and Medium Enterprises (MSMEs). Udyam Registration is one such scheme that is a move towards regularizing and formalizing MSMEs. This blog talks about who needs Udyam Registration, how to obtain it, its applications, benefits, validity, and required documents.
What is Udyam Registration?
Udyam Registration, also known as MSME Registration, is a registration process done by the government that gives a certification to Micro, Small, and Medium Enterprises (MSMEs) in India. It is a more convenient and less cumbersome process brought forth by the Ministry of Micro, Small, and Medium Enterprises to substitute the previous Udyog Aadhaar Registration system.
Who Needs Udyam Registration?
Udyam Registration is mandatory for any business that falls under the category of MSME by the Indian Government. The classification of MSME is made on the basis of the plant and machinery or equipment investment and the turnover of the year:
1. Micro Enterprises:
– Investment in plant and machinery or equipment: Maximum ₹1 crore
– Annual turnover: Maximum ₹5 crores
2. Small Enterprises:
– Investment in plant and machinery or equipment: ₹1 crore to ₹10 crores
– Annual turnover: ₹5 crores to ₹50 crores
3. Medium Enterprises:
– Investment in equipment or plant: ₹10 crores to ₹50 crores
– Annual turnover: ₹50 crores to ₹250 crores
If your company belongs to any of the above categories, then it is very useful to get a Udyam registration certificate.
Procedure for Udyam Registration
The procedure for Udyam Registration is simple and can be done online. Follow the step-by-step process below:
1. Visit the Udyam Registration Portal:
– Visit the official Udyam Registration portal (https://udyamregistration.gov.in/).
2. Select New Registration:
– Press the “For New Entrepreneurs Who Are Not Registered Yet as MSME” button.
3. Provide Aadhaar Number:
– Enter the 12-digit Aadhaar number of the business owner or signatory. Aadhaar is mandatory for Udyam registration.
4. Verify OTP:
– A One Time Password (OTP) will be sent to the registered mobile number linked with Aadhaar. Provide the OTP to verify yourself.
5. Enter Business Details:
– Enter the required business information, i.e., name, organization type, PAN, address, bank account information, and other related information.
6. Submit Udyam Registration Form:
– Once you have filled in all the information, submit the Udyam registration form online. A Udyam Registration Number (URN) will be created uniquely.
7. Get Udyam Registration Certificate:
– You shall get an Udyam registration certificate via email after successful registration. The certificate serves as proof of your MSME status.
Uses and Merits of Udyam Registration
1. Availability of Government Schemes:
Udyam registration helps MSMEs to avail themselves of government schemes, subsidies, and incentives such as the Credit Guarantee Fund Scheme, priority sector lending, etc.
2. Facility to Obtain Loans Easily:
Banks and financial institutions accord priority to Udyam-registered MSMEs, and availing loans at reduced interest rates is a cakewalk.
3. Protection Against Delayed Payments:
Udyam-registered MSMEs enjoy protection under the MSMED Act, which provides for payment on time by the buyer. If payments are delayed, MSMEs can approach the Micro and Small Enterprises Facilitation Council (MSEFC) for redressal.
4. Tax Benefits:
Tax advantages such as exemption and deduction under the Income Tax Act are enjoyed by registered MSMEs.
5. Government Tender Preference:
Government offices and public sector units tend to provide preferential treatment to MSMEs in tendering and procurement.
Validity of Udyam Registration
Udyam registration is permanent. No renewal or periodic upgradation of the registration is required. But it should be ensured that information furnished during registration is current and accurate. Any change of business details must be updated in the Udyam registration portal as soon as possible.
Documents to be used for Udyam Registration
1. Aadhaar Card: Aadhaar number of the owner or empowered signatory.
2. PAN Card: Permanent Account Number (PAN) of the business owner or business entity.
3. Business Address Proof: Rent agreement, utility bills, or property tax receipts.
4. Bank Account Details: Bank statement or a cancelled cheque with the bank account details of the business.
5. Investment and Turnover Proof: Financial accounts or audited statements to confirm the investment in plant and machinery or equipment and annual turnover.
Udyam Registration Fees
The Udyam registration process is totally free of cost. The process is free from charges, and thus it is open to all MSMEs.
Online Udyam Registration Process
The online procedure of registering Udyam is easy and can be performed in a couple of easy steps:
1. Official Portal Visit: Make a visit to the Udyam Registration portal.
2. Aadhaar Details: Fill in the Aadhaar number and verify the OTP.
3. Enter Business Details: Enter all the necessary business details.
4. Post Form Online: Post the online Udyam registration form.
5. Receive Certificate: Receive the Udyam registration certificate through email.
Udyam registration is a wonderful step towards regularising your business and getting a whole lot of benefits and support from the government. With the grant of an MSME certificate, companies can avail various benefits, ranging from improved credit to tax relief and safeguards against delayed payments. The registration is easy, free, and can be done online.
For expert advice and overall financial support, turn to OUTBAY. Our experts are trained to assist you through the Udyam registration process so that your business can reap maximum benefits. With OUTBAY’s assistance, you can tackle the intricacies of MSME registration confidently and achieve success in business.
