Udyam Registration / MSME

What is udyam registration certificate/msme?

The Union Ministry of Micro, Small and Medium Enterprises (MSME) has introduced a new process of classification and registration of MSME Enterprises under the name of ‘Udyam Registration’ on July 01, 2020.

An Udyam Registration Certificate is received by the applicant once the entire online registration process is complete. This Certificate is valid for lifetime. This certificate will have a dynamic QR Code from which the web page on the government Portal and details about the enterprise can be accessed.

Note: You are also informed that PAN is mandatory for Udyam Registration from 01.04.2021.

Enterprises engaged in the Manufacturring [production, processing or preservation of goods] and Services [whose investment in equipment (original cost excluding land and building and furniture, fittings and other items not directly related to the service rendered) or as may be notified under the MSMED Act, 2006] as specified below:

A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 1 crore and Turnover does not exceed 5 crore;

A small enterprise is an enterprise where the investment in plant and machinery is between Rs. 1 crore to Rs. 10 crore and turnover is between Rs. 5 crore to Rs. 50 crore ;

A medium enterprise is an enterprise where the investment in plant and machinery is between Rs. 10 crore to Rs. 20 crore and turnover is between Rs. 50 crore to Rs. 250 crore. 

Documents required for the udyam registration certificate/msme?

• Aadhaar Card

• PAN Card

• Cancelled Cheque / Bank Passbook [Any -1]

• GSTIN Certificate If Available

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Procedure for the udyam registration certificate/msme?

Fill Online Application Form

Udyam Registration Certificate/MSME is FREE

Get Udyam Certificate/MSME on Email

Benefits of udyam registration certificate/msme?

• Collateral Free loans from banks - The Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGS) was launched by the Government of India to make available collateral-free credit to the micro and small enterprise sector. Both the existing and the new enterprises are eligible to be covered under the scheme. The Ministry of Micro, Small and Medium Enterprises, Government of India and Small Industries Development Bank of India (SIDBI), established a Trust named Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) to implement the Credit Guarantee Fund Scheme for Micro and Small Enterprises.

• Reservation policies to manufacturing / production sector - Reservation of items for exclusive manufacture in SSI sector statutorily provided for in the Industries (Development and Regulation) Act, 1951, has been one of the important policy measures for promoting this sector. The Reservation Policy has two objectives :-Ensure increased production of consumer goods in the small scale sector & Expand employment opportunities through setting up of small scale industries

• Very easy to get Licenses, approvals and registrations - It has made very easy for enterprises that are having MSME Certificate to obtain Licenses, approvals and registrations on any field for their business from the respective authorities as they can produce the Certificate of MSME Registration while making application.

• Special consideration on international trade fairs - Under the International Cooperation Scheme, financial assistance is provided on reimbursement basis to the State/Central Government organizations, industries/enterprises Associations and registered societies/trusts and organizations associated with MSME for deputation of MSME business delegation to other countries for exploring new areas of MSMEs, participation by Indian MSMEs in international exhibitions, trade fairs, buyer seller meet and for holding international conference and seminars which are in the interest of MSME sectors.

• Octroi benefits - The scheme of refund of octroi provided under the Package Scheme of Incentives, 1993 will be included in the new Scheme up to 31-3-2006 on the same pattern. Where account-based cess or other levy is charged instead of or in lieu of octroi, such change will also be eligible for refund as in the case of octroi.

• Waiver of Stamp Duty and Registration Fees - At present, IT units in public IT Parks are exempted from stamp Duty and Registration fees upto 31st March 2006. Now all new industrial units having MSME Registration and expansions will be exempted from payment of Stamp Duty and Registration fees.

• Exemption under Direct Tax Laws - Enterprises that have MSME Registration can enjoy Direct Tax Exemption in the initial year of business, as mention in the scheme by Government and depending on business activity.

• Bar Code registration subsidy - Enterprises that have MSME Registration can avail Bar Code Registration subsidy as mentioned in the scheme.

• Subsidy on NSIC Performance and Credit ratings - Enterprises that have MSME Registration can avail Subsidy on NSIC Performance.

• Eligible for IPS subsidy - Enterprises that have MSME Registration are eligible for Industrial Promotion Subsidy (IPS) as mentioned in the scheme.

• Counter Guarantee from Government of India through CGSTI - Enterprises that have MSME Registration are eligible for Counter Guarantee from Government of India through CGSTI.

• Protection against delay in payment - The Ministry of Micro, Small and Medium Enterprises gives protection to MSME Registered Business against delay in payments from Buyers and right of interest on delayed payment through conciliation and arbitration and settlement of dispute be done in minimum time. If any micro or small enterprise that has MSME registration, supplies any goods or services, then the buyer is required to make payment on or before the date agreed upon between the buyer and the micro or small enterprise. In case there is no payment date on the agreement, then the buyer is required to make payment within fifteen days of acceptance of good or services. Further, in any case, a payment due to a micro or small enterprise cannot exceed forty-five days from the day of acceptance or the day of deemed acceptance. In case of failure by the buyer to make payment on time, the buyer is required to pay compound interest with monthly interest rests to the supplier on that amount from the agreed date of payment or fifteen days of acceptance of goods or service. The penal interest chargeable for delayed payment to a MSME enterprise is three times of the bank rate notified by the Reserve Bank of India.

• Reduction in rate of Interest from banks - The rate of Interest for enterprise that has MSME registration are lower as compare to other enterprises. Certain targets are set for banks’ lending to the Micro and Small Enterprises. The banks’ have to achieve a 20% growth in credit to micro and small enterprises and 10% annual growth in the number of micro enterprises accounts and 60% of total lending to Micro and Small Enterprises sector. The banks have to follow the following:

  1. 40% of the total advances must go to micro and small enterprises involved in manufacturing having investment in plant and machinery up to Rs.10 lakh and for service enterprises having investment in equipment up to Rs.4 lakh.

  2. 20% of the total advance to micro and small enterprises should go to manufacturing enterprises that have above Rs.10 lakh till Rs.25 lakh investment in the plant and machinery and for service enterprises that have investments in equipment above Rs.4

  3. To simplify, 60% of the advances must go to micro enterprises.

  Enterprises that have MSME Registration Certificate can reimburse ISO Certificate Expenses by making application to respective authority along with MSME.

• Excise Exemption Scheme - Enterprises that have MSME Registration can enjoy Excise Exemption in the initial year of business, as mention in the Excise Exemption scheme by Government and depending on business activity.

• Preference in procuring Government - Enterprises that have MSME Registration have preference in procuring government tenders. Special treatment is given to MSME Registered organization while making application for government tenders.

• P15% weightage in price Preference - Enterprises that have MSME Registration can avail 15% weightage in price Preference as mentioned.

• 1% exemption on interest rate on OD - Enterprises that have MSME Registration can avail benefit of 1% exemption on interest rate on OD as mentioned in the scheme.

• 50% subsidy for patent registration - Enterprises that have MSME Registration Certificate can avail 50% 50% subsidy for patent registration by making application to respective authority.

Frequently Asked Questions (FAQs)

Who Can Apply for Udyam Registration?

y entrepreneur having valid Aadhaar Number can apply for Udyam Registration with Below Criteria:

Enterprises engaged in the Manufacturring [production, processing or preservation of goods] and Services [whose investment in equipment (original cost excluding land and building and furniture, fittings and other items not directly related to the service rendered) or as may be notified under the MSMED Act, 2006] as specified below:

• A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 1 crore and Turnover does not exceed 5 crore;

• A small enterprise is an enterprise where the investment in plant and machinery is between Rs. 1 crore to Rs. 10 crore and turnover is between Rs. 5 crore to Rs. 50 crore ;

• A medium enterprise is an enterprise where the investment in plant and machinery is between Rs. 10 crore to Rs. 20 crore and turnover is between Rs. 50 crore to Rs. 250 crore .

Is physical copy of Certificate will be issued?

In the interest of environment no physical copy of Udyam Registration Certificate will be issued. Government believes in paperless work.

Is Aadhaar Number mandatory for Udyam Registration?

At present Aadhaar Number is mandatory for issuance of Udyam Registration Certificate.

What is the support available for technology upgradation?

Ministry implements a scheme called Credit Linked Capital Subsidy Scheme (CLCSS) for technology upgradation of Micro and Small enterprises in the country. Under the scheme, 15 per cent capital subsidy, limited to maximum of Rs 15 lakh (12 % prior to 29.09.2005 limited to maximum of Rs 4.8 lakh) is provided to the eligible MSEs for upgrading their technology with the well-established and improved technology as approved under the scheme. 48 products/sub-sectors have been approved under the CLCSS till date. If you are an MSE manufacturing a product and want to upgrade the technology of manufacturing the product with the well-established and improved technology as approved under the Scheme, then you may have to approach to the nodal agencies/eligible financial institution for sanction of term loan for purchase of eligible machinery.

What is the definition of MSME?

Enterprises engaged in the Manufacturring [production, processing or preservation of goods] and Services [whose investment in equipment (original cost excluding land and building and furniture, fittings and other items not directly related to the service rendered) or as may be notified under the MSMED Act, 2006] as specified below:

• A micro enterprise is an enterprise where investment in plant and machinery does not exceed Rs. 1 crore and Turnover does not exceed 5 crore;

• A small enterprise is an enterprise where the investment in plant and machinery is between Rs. 1 crore to Rs. 10 crore and turnover is between Rs. 5 crore to Rs. 50 crore ;

• A medium enterprise is an enterprise where the investment in plant and machinery is between Rs. 10 crore to Rs. 20 crore and turnover is between Rs. 50 crore to Rs. 250 crore .