MSME stands for Micro, Small and Medium Enterprises. These are the backbone of the Indian economy, contributing to employment, innovation and growth. MSME registration is a voluntary process that provides various benefits and incentives to eligible enterprises.
In this blog, we will explain what MSME registration is, who can apply for it, what are the benefits of MSME registration, when to apply for it, what documents are required, how to get MSME registration online, and how to renew MSME registration.
What is MSME Registration?
MSME Registration, also known as Udyam Registration, is a free online process for identifying and recognizing micro, small, and medium enterprises in India. It provides a unique 12-digit Udyam Registration Number (URN) and a certificate, unlocking a treasure trove of benefits that can propel your business to new heights.
Who can apply for MSME registration?
Any enterprise that falls under the following criteria can apply for MSME registration:
- Microenterprise, where the investment in plant and machinery or equipment does not exceed one crore rupees and turnover does not exceed five crore rupees.
- Small enterprise, where the investment in plant and machinery or equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees.
- Medium enterprise, where the investment in plant and machinery or equipment does not exceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees.
The investment and turnover limits are based on the PAN and GST-linked details of the enterprise, which are taken automatically from the government databases. The investment in plant and machinery or equipment excludes the cost of land, building and other items specified by the Ministry of MSME.
Benefits of MSME Registration
MSME registration provides various benefits and incentives to the registered enterprises, such as:
- Collateral-free loans from banks and financial institutions at concessional rates of interest and priority sector lending.
- Subsidy on patent registration, trademark registration, ISO certification and quality standards.
- Exemption from certain direct and indirect taxes, such as income tax, GST, excise duty and customs duty.
- Preference in government procurement and public sector undertakings, with reserved quota and price preference.
- Rebate on electricity bills, water bills and stamp duty.
- Access to credit guarantee fund trust, technology upgradation fund, cluster development fund and other schemes for MSMEs.
- Eligibility for MSME awards, recognition and export promotion.
- Protection from delayed payments, unfair trade practices and resolution of disputes.
When to Apply for MSME Registration?
There is no deadline or expiry date for MSME registration. An enterprise can apply for MSME registration at any time, before or after starting its operations. However, it is advisable to apply for MSME registration as soon as possible, to avail the benefits and incentives from the date of commencement of business.
Documents Required
As mentioned earlier, MSME registration is based on self-declaration and does not require any documents or proof to be uploaded. Only Aadhaar number is required for MSME registration.
However, the following documents may be required for verification or reference purposes:
- PAN card of the enterprise and the owner or promoter
- GST registration certificate of the enterprise
- Bank account details of the enterprise
- Business address proof, such as rent agreement, electricity bill, water bill, etc.
- Business activity details, such as products or services offered, raw materials used, etc.
How to Get MSME Registration Online?
MSME registration can be done online through the official website of the Ministry of MSME, Udyam Registration Portal.
The steps to get MSME registration online are as follows:
- Visit the Udyam Registration Portal and click on the link for new registration.
- Enter the Aadhaar number and name of the owner or promoter click on validate and generate OTP.
- Enter the OTP received on the registered mobile number or email id and click on validate.
- Fill the online form with the details of the enterprise, such as PAN, GST, bank account, address, activity, etc.
- Review the details and click on submit.
- A permanent registration number, called Udyam Registration Number, will be generated and displayed on the screen.
- A certificate of registration, called Udyam Registration Certificate, will be issued online and sent to the registered email ID. The certificate will have a dynamic QR code, which can be used to access the web page and details of the enterprise.
Renewal of MSME Registration
MSME registration does not require any renewal or periodic updation. However, the enterprise has to update its information on the Udyam Registration Portal, such as investment, turnover, employment, etc., on a self-declaration basis.
The information will be validated by the portal based on the PAN and GST linked data of the enterprise. The enterprise will be re-classified as a micro, small or medium enterprise, based on the updated information. The Udyam Registration Certificate will also be updated accordingly.
Conclusion
MSME registration is a simple and beneficial process for micro, small and medium enterprises in India. It provides various benefits and incentives to registered enterprises, such as loans, subsidies, tax exemptions, preference in government procurement, etc.
MSME registration can be done online through the Udyam Registration Portal, with only Aadhaar number required. MSME registration does not require any renewal or documents, but the enterprise has to update its information on the portal on a self-declaration basis.
FAQs
Here are some frequently asked questions about MSME registration:
1. Is MSME registration mandatory or optional?
MSME registration is optional and voluntary. However, it is recommended for the enterprises to register as MSMEs, to avail the benefits and incentives offered by the government and other agencies.
2. What is the difference between Udyam Registration and Udyog Aadhaar?
Udyam Registration is the new and simplified process of MSME registration, which was launched on 1st July 2020. Udyog Aadhaar was the previous process of MSME registration, which was valid till 30th June 2020. Udyam Registration is based on Aadhaar, PAN and GST-linked data of the enterprise, whereas Udyog Aadhaar was based on Aadhaar and self-reported data of the enterprise.
3. How to check the status of MSME registration?
The status of MSME registration can be checked online through the Udyam Registration Portal, by entering the Udyam Registration Number or the reference number.
4. How to download the MSME registration certificate?
The MSME registration certificate, called Udyam Registration Certificate, can be downloaded online through the Udyam Registration Portal, by entering the Udyam Registration Number or the reference number. The certificate can also be accessed through the dynamic QR code on the certificate.
5. How to cancel or modify MSME registration?
MSME registration can be cancelled or modified online through the Udyam Registration Portal, by entering the Udyam Registration Number or the reference number. The enterprise has to provide the reason for cancellation or modification and submit the request. The request will be processed by the portal and the certificate will be cancelled or modified accordingly.
