To help the MSMEs in India, the Indian Government introduced a new metric on May 13, 2020. According to this metric, all MSMEs in India would be known as “Udyam” and would have to go through the registration process known as “Udyam Registration”.
The term "Udyam" comes from Sanskrit, meaning "enterprise" or "business venture," symbolizing entrepreneurship and business development. This registration has been approved by the Union Cabinet and has made this mandatory from 1 July 2020.
The Udyam certificate is available immediately after registration to download without any renewal requirements. The MSME certificate issued through Udyam acts as your single-window solution for accessing government schemes, subsidies, loans, and market opportunities. The platform is fully integrated with income tax and GST databases, ensuring automatic verification of your business information without requiring manual document uploads.
Features of Udyam Registration
1. Unique Registration Number
Every business will receive a unique Udyam number, which is a 16-digit alphanumeric identifier. This number becomes the permanent identifier of your business, which is linked to your PAN and GST information.
2. Digital E-Certificate
Once the registration is completed, the udyam certificate will be available online, which can be printed, downloaded or stored digitally, which will help in instant verification by government departments.
3. Completely Free Registration
The entire process of Udyam registration is free of cost, making it accessible to businesses of all sizes.
4. No Renewal Required
Udyam card has a lifetime validity, which means there is no expiration and no renewal required. The registration is permanently valid unless voluntarily closed.
5. Tax System Integration
Udyam portal is integrated with the Income Tax and GST systems, which automatically validate the business details through government records.
6. Single Registration Per PAN
An enterprise will only have one Udyam registration linked to its PAN. However, under one registration, multiple business activities can be registered.
7. Export Turnover Exclusion
The revenue earned from exports is not counted while calculating the annual turnover for MSME classification, encouraging export opportunities.
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Eligibility for Udyam Registration
To get a Udyam Registration, a business must
- Be an MSME
- Be a legal entity, such as a sole proprietorship, partnership firm, limited liability partnership, or another legal entity.
- Meet the following requirements-
| Enterprises Type | Investment Limit | Annual Turnover Limit |
| Micro Enterprises | Up to ₹1 crore | Up to ₹5 crores |
| Small Enterprises | Up to ₹10 crores | Up to ₹50 crores |
| Medium Enterprises | Up to ₹50 crores | Up to ₹250 crores |
Documents Required for Udyam Registration
Here is the list of documents required-
1. Aadhaar Card
In case of Proprietorship- Aadhar number of the owner
In case of a company/partnership- Aadhaar number of authorized signatory.
In case of Hindu Undivided Family(HUF) - The Karta’s Aadhaar number
In case of Companies, LLPs, Cooperative Societies, Societies, or Trusts - Aadhaar number of the authorized representative of the organization.
2. PAN Card
The company’s Permanent Account Number (PAN) card is mandatory from April 1, 2021. This will be used for verification against income tax records.
3. GST Registration Certificate
Goods and Services Tax Identification Number for GST-registered businesses.
If your business is GST registered, then the Goods and Services Tax Identification (GST) Number is mandatory under the GST law.
4. Address Proof
Official proof of your business address, this can be proven with documents such a Utility bill, electricity bill, rent agreement, or property papers.
5. Bank Account Details
Bank’s name, Account number, and IFSC code of the organization is required.
6. Financial Details
Latest Income Tax Return(ITR) and financial statements showing Investments made in plants, machinery, or equipment, and annual turnover are required.
7. Turnover Details
Financial statements or turnover details of the business to validate the annual turnover.
8. Self-Declaration
A self-declaration states the correctness and authenticity of the provided information.
Udyam Registration Process
Step 1: Visit the Official Udyam Registration Website
Go to the official Udyam Registration Portal to begin your registration process.
Step 2: Select Your Entrepreneur Status
If you are a new entrepreneur yet to register as an MSME, click on “for new entrepreneurs who are not registered yet as MSME or those with EM-Il”
Step 3: Enter Aadhar Details for verification
Enter your Aadhaar number and the name of the entrepreneur, as per the Aadhaar card. Click on Validate and generate OTP.
Step 4: Verify your PAN Number
Enter your PAN number here and click the “Validate” button to verify your PAN.
Step 5: Fill in Additional Information Required
Once the Aadhaar and PAN verification is completed, complete the additional information section. This section includes information like organisation type, specifying business activity, providing the address and bank details, IFSC code, and any other relevant information.
Step 6: Review and submit the form
Once all the information is filled out, review the form carefully before final submission.
Check your registered email address and mobile number to generate the Udyam Registration number(URN)
After submitting the form, you will receive the unique registration number and a certificate.
The certificate will include a QR code, allowing access to your enterprise’s details.
Common Mistakes to Avoid During Udyam Registration Certificate Application
For a smooth Udyam regi process, avoid these mistakes
- Incorrect Aadhaar details- Make sure the Aadhaar number is correct and linked to the business owner's name.
- Aadhaar and PAN Card Mismatch- Make sure the accurate PAN card number is entered.
- Inconsistent Business Information- All the business information provided should match the documents provided so that no mismatch or rejection occurs.
- Omitting Mandatory Fields- Do fill in all the details in the registration form to avoid delay and rejection.
- Upload valid, original, and clear documents- Provide clear and valid copies of documents like PAN card and bank account details.
- Skipping OTP Verification- Complete the Aadhaar OTP verification and proceed
- Incorrect Financial Information- Ensure that all the investment and turnover figures are accurate to avoid classification errors.
- Wrong NIC Code Selection- Carefully review the NIC code list and select the one that most accurately describes your primary business activity.
Post-Registration Benefits and Obligations
Once the Udyam Registration Certificate has been received, there are several benefits and responsibilities-
Access to Government Schemes
Businesses can avail schemes like a credit scheme and subsidies.
Lower Interest Rates on Business Loans
Registered MSMEs enjoy reduced rates for financing.
Collateral-free Credit
Banks provide collateral free credit to the registered MSMEs under various government schemes
Delayed Payment Protection
It gives protection under the MSME Development Act, 2006 and ensures timely payment from the buyers.
Enhanced Market Opportunities
The Udyam-registered MSMEs get priority in the trade fairs, exhibitions, and procurement events.
Support for Export Growth
MSME registration opens access to other countries through the provisions and incentives made to export-oriented firms in helping expand exports.
Brand Credibility
The registered MSMEs will receive recognition, hence enhancing their reputation before buyers and partners globally.
FAQs
1. What is Udyam Registration?
Udyam registration is a free, online, paperless registration system for the Micro, Small, and Medium Enterprises (MSMEs), to register them. It provides businesses with a permanent 16-digit Udyam registration number and an e-certificate that serves as official proof of MSME status.
2. Is the Udyam certificate free?
Yes, Udyam registration is completely free. There are zero registration fees charged by the government. However, unofficial websites or agents may charge some fees.
3. Why is Udyam Registration mandatory?
Udyam registration is not for all businesses, but it is highly recommended because it gives a lot of benefits to businesses. Once you register for MSME through Udyam, you become eligible for priority sector lending, government schemes, exclusive tenders, tax concessions, and subsidies.
4. How to check the Udyam certificate?
To check your Udyam registration certificate,
- Visit https://udyamregistration.gov.in
- Click on "Print/Verify" and select "Print Udyam Certificate"
- Enter your Udyam registration number and registered mobile number
- Enter the OTP sent to your mobile
- Your certificate will display on screen for download
5. How can I check my Udyam registration status?
To check the status of your Udyam registration, you can visit the Udyam Registration Portal, click on ‘Print/Verify’, and choose ‘verify Udyam Registration Number’. Enter your reference number and captcha to check the status.
6. Who is eligible for MSME Udyam registration?
Entities such as individuals, startups, companies, LLPs, co-operative societies, and trusts engaging in eligible to apply for the Udyam Certificate.
