MSME Registration in India

MSME Registration/Udyam Registration & Overview

Micro, Small, and Medium Enterprises (MSMEs) are vital to India's economic growth and development. To support and promote these businesses, the Government of India introduced the Udyam Registration process, a simplified and streamlined way for MSMEs to register.

Introduced on July 1, 2020, by the Ministry of MSME, Udyam Registration replaces the old registration method, making it easier and more efficient. The new process provides a more efficient way to register micro, small, and medium enterprises in India, ensuring that these businesses can easily access their benefits and support.

Businesses that qualify as MSMEs can apply for registration on the Udyam portal. After completing the online registration process, they will receive a permanent registration number, which will be issued online. This makes the registration process quick and convenient for MSMEs across the country.

What is MSME Udyam Registration?

MSME Udyam registration is a compulsory certification issued by the Ministry of Micro, Small and Medium Enterprises that MSMEs receive upon signing up on the official government portal. By obtaining an MSME Udyam registration, MSME businesses receive a unique twelve-digit Udyam registration number. This Udyam registration number helps businesses obtain and avail themselves of various benefits and government subsidies, schemes, and incentives.

The Ministry of MSME has introduced the Udyam registration portal to digitalize India and streamline processes. It is a technology-advanced system that assists small and medium businesses in growing and providing all the necessary support. Therefore, MSME certification is mandatory if you seek legal and operational certification for small and medium businesses.

What is the difference between MSME and Udyam Registration?

MSME registration and Udyam registration are the same processes for registering MSME businesses in India. The earlier MSME registration has been transformed into the new MSME registration, commonly known as Udyam registration. Here given below are the differences between MSME and Udyam registration:

1. Registration Method

The old MSME registration only requires the applicant's Aadhar card and PAN number, providing instant self-certification. In contrast, Udyam registration only requires the applicant's Aadhar card and provides verified certification according to MSME criteria.

2. Integration of other Portals

The old MSME registration was not integrated with other government portals; however, Udyam registration is fully integrated with other MSME portals.

3. Registration form

New MSME registration, i.e., the Udyam portal, requires comprehensive details from various portals, such as the Income Tax and GST departments. In contrast, old MSME registration (Udyog Aadhar) requirements are short and direct, with minimal details.

4. Number of Registration

Udyog Aadhar can be registered many times with different corporate names, whereas Udyam registration can be obtained by a single person with a single Aadhar card.

Who can Apply for Udyam Registration?

MSME seeking to obtain a Udyam registration certificate must meet the MSME eligibility registration criteria, such as the business must be in either of the following lists given below:

• Sole Proprietorship
• Partnering Firm
• Limited Liability Partnership
• Cooperative Societies
• Association of Persons
• Any other undertakings
• Hindu Undivided Family (HUF)
• One-Person Companies
• Any associations of persons

What is MSME Classification?

According to the Aatma Nirbhar Bharat Abhiyan Scheme 2020, MSMEs are classified according to the turnover and investment they earned or received. Below is the list of MSME classifications according to investment and annual turnover.

1. Micro Business:- Investment in plant and machinery or equipment that does not exceed Rs.1 crore and turnover does not exceed Rs. 5 crore.
2. Small Business :- A small Investment refers to an investment that does not exceed Rs. 10 crore and a turnover that does not exceed Rs. 50 crore.
3. Medium Enterprise:- Investment in plant and machinery or equipment does not exceed 50 core, and turnover does not exceed 200 crore.

Note: In case the enterprise crosses the ceiling limits specified for its present category in either of the two criteria of investment or turnover, it will cease to exist in that category and be placed in the next higher category, but no enterprise shall be placed in the lower category unless it goes below the ceiling limit specified for its present category in both the criteria of investment as well as turnover.

When to Opt for Udyam or MSME/SSI Registration?

There are no obligations to opt for Udyam or MSME/SSI registration, which remains at the business's discretion. However, it is recommended that businesses apply for MSME registration online as soon as possible after establishing the businesses. This Udyam registration at an early stage allows entrepreneurs or businesses to obtain and avail of a range of benefits provided by the government of India.

Benefits of MSME Udyam Registration

Udyam registration is now mandatory for all MSMEs business in India. This MSME registration provides several benefits that help MSMEs achieve business growth and success. Here given below is the most common list of benefits of MSME Udyam registration:

• It will be a permanent registration and basic identification number for an enterprise.
• MSME/SSI registration is paperless and based on self-declaration.
• Banks and financial institutions provide collateral-free loans at subsidised interest rates.
• Simpler process of obtaining licenses, permits, registrations, and approvals
• As Udyam registration is integrated with the government e-marketplace and various other state governments, it helps to acquire government tenders easily.
• There is only a one-time settlement fee for non-paid amounts of MSME
• Easy to obtain government benefits such as Credit Guarantee Scheme, Credit Linked Capital Subsidy Scheme, Public Procurement Policy, Protection against delayed payment, etc
• Barcode registration subsidy
• Exemption scheme from direct taxes
• Electricity bills and water concession
• ISO certification fee reimbursement

Documents Required for MSME Registration in India

MSME registration is indeed free, paperless, and based on self-declaration. The only documents required for MSME registration are the Aadhar card and PAN card. However, the Udyam registration portal will automatically extract PAN and GST linked details on investment and business turnover from government databases.

Meanwhile, obtaining GST registration is not mandatory for businesses that do not require GST registration. Therefore, businesses that must obtain GST registration per the GST law must enter their GSTIN details to obtain the MSME or Udyam registration.

MSME/Udyam/SSI Registration Process

In India, the MSME registration process is completely online. This MSME registration online is done on the government portal of MSME. Given below is the process of MSME/Udyam/SSI registration:

1. Firstly, visit the government's official Udyam registration portal.
2. Secondly, on the homepage, click on the option for either new entrepreneurs (not registered as MSME) or those with EM-II.
3. Thirdly, enter the entrepreneur's valid Aadhar number and name, followed by clicking the validate and generate OTP button.
4. Fourthly, enter the OTP number sent to the registered mobile number linked with the Aadhar card.
5. Once the Aadhaar is validated, proceed to the PAN verification dashboard. Enter the type of organisation's PAN number and click the validate button. Also, indicate whether you filed the previous year's ITR and have a GSTIN.
6. Now, the Udyam registration application form will appear. Fill the same form by entering details such as the entrepreneur's name, mobile number, enterprise name, location of the plant or unit, NIC code, and number of persons employed.
7. Followed by inserting investment details in the plant, machinery details, and turnover details. Accordingly, select the declaration and click the submit button.
8. After receiving the OTP, enter it and submit the form. You will then receive the Udyam e-registration certificate in your registered email address.

Note: No enterprise shall file more than one Udyam Registration, provided that any number of activities, including manufacturing service or both, may be specified or added to one Udyam Registration.

How to Check MSME Registration Status?

After completion of the MSME registration process, here given below is the process to check the MSME registration status:

• Visit the government's official Udyam registration portal.
• Next, click on the print or verify option, then click on the verify Udyam registration number option.
• Lastly, enter the reference number, enter the captcha code, and click the verify button.

Process to Download MSME Registration Certificate

To download the MSME registration certificate, follow the below steps to obtain the Udyam registration certificate.

1. Visit the Udyam registration portal.
2. Next, click the print or verify option and select the option print Udyam certificate.
3. Now, enter the Udyam registration number and mobile number you filled in on the MSME registration application and click on the button to validate and generate OTP.
4. Enter the OTP received on the registered mobile or email address and click the validate OTP & login button.
5. After completing the login, print out the Udyam registration certificate.

Validity of MSME Certificate

The validity of an MSME certificate does not typically expire, as it lasts as long as the existing enterprises or businesses continue to operate within the investment limits specified for MSMEs. However, it is suggested that businesses with Udyam registration certificates must ensure that their certificates are up to date and accurately reflect the current business status and information.

Meanwhile, the government periodically revises the definition and criteria for MSMEs, so staying updated, informed, and compliant with these periodic changes is necessary for maintaining the validity of the MSME registration certificate.

Udyam Registration Number

An enterprise or business with an MSME registration is known as Udyam. It is the permanent identity number issued by the Ministry of Ministry of Micro, Small and Medium Enterprises, commonly known as the Udyam/MSME registration number. This MSME registration certificate consists of a 19-digit MSME/Udyam registration number.

Udyam Registration Certificate

After completing the Udyam registration process, businesses will receive a permanent registration number from the Ministry of Micro, Small and Medium Enterprises. This e-certificate will include a dynamic QR code, allowing easy access to the enterprise's details.

Renewal of Udyam/SSI Registration

The Udyam Registration Certificate issued to enterprises after MSME registration is valid for a lifetime. With reference to the notification dated 26.06.2020, Uydam/SSI registration information regarding investment, turnover, and export of the financial year needs to be updated on the Udyam registration portal for the MSME re-classification during every change of financial year.

There is no such renewal of Udyam Registration, but there is an information update and a transition period in classification. An enterprise with a Udyam Registration number shall update its information online in the Udyam Registration portal, including details of the ITR and GST return for the previous financial year and other information that may be required on a self-declaration basis.

However, failure to update the relevant information within the period specified in the online Udyam Registration portal will render the enterprise liable for suspension of its status.

Udyam Registration Penalty

Whoever intentionally misrepresents or attempts to suppress the self-declared facts and figures appearing in the Udyam Registration or updation process shall be liable to legal penalties according to the MSMED Act, 2006.

Udyam Registration Fees and Processing Time

The consultation fees for MSME registration start from Rs.1000/—; depending on documentation requirements, this fee may vary. However, you can now obtain Udyam registration from the government's official website, the Udyam portal. On the other hand, the Udyam Registration certificate will be issued within two to four business days to the registered email ID of the applicant entrepreneurs or businesses.

Why Choose Enterslice for MSME Registration

Choosing Enterslice provides hassle-free and efficient registration and various other services related to MSME. We have a dedicated team of professionals who will help you throughout the process of MSME registration until the certificate is issued. We have been helping entrepreneurs and businesses grow and meet their regulatory registration for the last ten years. These years of experience make us one of the renowned MSME registration service providers in the market.

We offer comprehensive services that cover the registration process and provide continuous support and guidance to help businesses leverage the full benefits available to MSMEs. Here, given below is the list of services offered by Enterslice:

1. Consultation & Guidance

Get personalized guidance and expert guidance regarding MSME registration. Our experts help determine the classification of MSME and eligibility to obtain government benefits.

2. Documentation Assistance

We shall also help gather and assist in documentation to ensure compliance with the MSME registration requirements.

3. Application Filing

We also help with end-to-end assistance in filing applications diligently, ensuring error-free applications and achieving the highest satisfaction from our clients.

4. Follow-up & Updates

We shall also provide regular updates on the status of the MSME registration by regularly following up and monitoring the application submitted by our client.

5. Post Registration Support

Our service also includes post-registration, where we support MSMEs after registration to meet various compliance requirements as per the MSME laws and regulations.

6. Updation or Upgradation

We also help with MSME/SSI registration updation or upgrade of information and transition period in classification, ensuring that the MSME-registered businesses have updated their last year's GST and Income tax status.

7. Access to benefits

Our team of professionals also assists in obtaining government subsidies, schemes, and various other incentives available to MSME registered. Additionally, we help in obtaining financial support and credit facilities available to MSME registered.

8. Legal & Regulatory Updates

Obtain regular updates and changes related to SSI registration through our service experts. Our team of legal experts provides legal assistance and support to MSME businesses.