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India's Gross Domestic Product (GDP) greatly benefits from the significant contribution of micro, small, and medium-sized enterprises (MSMEs). These enterprises employ over 110 million individuals. However, MSMEs encounter numerous challenges and obstacles as they strive to expand and grow. In order to support and assist these MSMEs, the Indian government took a proactive step on May 13, 2020, by introducing a new classification metric for MSMEs in India. Under this classification, all MSMEs in the country will be referred to as 'Udyam' and will be required to undergo a registration process called 'Udyam Registration'. The Union Cabinet has approved this classification, making Udyam registration mandatory for all MSMEs starting from July 1, 2020.
After successfully enrolling in this system, you will be assigned a distinctive GSTIN (Goods and Service Tax Identification Number) by the Central government. This 15-digit number is allocated on a state-wise basis upon the completion of the registration process. GST registration offers several benefits, including establishing a legal identity as a supplier. Additionally, it enables you to take advantage of input tax credits and facilitates the collection of GST from recipients of goods and services.
In order to classify Micro, Small, and Medium Enterprises (MSMEs) in India and grant them appropriate benefits, the Ministry of Micro, Small, and Medium Enterprises has implemented Udyam Registration. The Udyam registration system has been designed by the government to ensure that registered MSMEs are automatically included in other government databases such as PAN, GST, and IT.
There are numerous advantages for MSME business owners who choose to register their businesses under the Udyam classification. These benefits encompass the following:
1. Facilitates the acquisition of government tenders, opening up opportunities for business growth and expansion.
2. Enables access to business loans from both banks and non-banking financial corporations (NBFCs) at reduced interest rates.
3. Provides eligibility for exclusive tax rebates specifically designed for Udyam enterprises.
4. Simplifies the process of obtaining government approvals, licenses, and registrations necessary for operating a business.
5. Grants access to tariff subsidies and capital tax subsidies, reducing financial burdens.
6. Offers rebates and concessions specifically tailored for establishing industries, further supporting business development.
In order to access the aforementioned benefits, it is necessary for you to complete the Udyam registration process for your business. Once the registration is completed, you will be provided with an Udyam Registration Certificate. Below, you will find a step-by-step guide to assist you with the Udyam registration:
Step 1
To initiate the Udyam registration process, please visit the official website by clicking on this link.
Step 2
On the Home Page, locate and click on the ‘New Registration’ tab. This will direct you to the Udyam registration form.
Step 3
Enter your Aadhar card number and PAN card number, and proceed to validate them by entering the OTP received on your mobile number.
Step 4
Select the type of business or organization you are associated with, and provide the business PAN number linked to your business accounts.
Step 5
Fill in all the necessary details in the form. It is important to review each piece of information carefully before submitting the registration form.
Step 6
After completing the form, submit and validate your Udyam registration by entering the OTP received on your mobile number.
Step 7
Upon successful registration, you will receive a ‘Thank You’ message on your mobile number and e-mail ID, along with your unique Udyam registration number.
Step 8
Finally, you can proceed to download and print your Udyam Registration Certificate.
Individuals who have the intention of setting up a micro, small, or medium enterprise are eligible to submit an application for Udyam Registration. This includes various types of entities such as Partnership Firms, One Person Companies, Proprietorships, Private Limited Companies, Limited Companies, Producer Companies, Limited Liability Partnerships, any association of persons, co-operative societies, and Hindu Undivided Families (HUF). It is important to note that, in accordance with the Revised Guidelines for MSME, retail and wholesale trades are now permitted to register on the Udyam Registration Portal.
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