Registration For MSME
The MSME sector is one of the main pillars of the Indian economy thanks to its unprecedented contribution toward GDP. Often acknowledged as SSI i.e. Small Scale Industries, most MSMEs experience financial and resource shortages which ultimately impact their production capabilities. The impetus they need to thrive is mostly missing owing to a lack of support from higher authorities and banks. To curb this serious concern, the Indian government rolled out a voluntary certification scheme viz.
MSME registration (now known as Udyam Registration) in 2006. Falling under the MSME Act 2006, this registration spans small and financially aggrieved facilities seeking growth opportunities and constant support. This registration for MSMEs came as a boon since it offers valuable benefits, including access to government tenders, fee exemption on trademarks, easy credits, etc. With that being said, let’s delve into the key aspects of MSME registration, its process, paperwork, and benefits.
An Overview of MSME Classification
Before you apply for the MSME registration, gauge whether or not you fall under the MSME Act 2006 and are eligible to be recognized as MSME:
There are two parameters used to define which entity is eligible to be called an MSME. These include investment and annual turnover.
The investment refers to the amount spent on making a facility operational. The investment includes expenses concerning machine procurement and resources. The annual turnover, as the name suggests, is the amount of money generated in 12 months after selling the products.
The table below reflects the revised MSME classification, showing the eligibility criteria to register as an MSME.
| Revised MSME Classification | |||
| Criteria | Micro entities | Small Entities | Medium Entities |
| Investment & Annual Turnover | < Rs.1 crore & < Rs.5 crore | < Rs.10 crore & < Rs.50 crore | < Rs.50 crore & < Rs.250 crore |
Udyam registration for MSMEs: Underscoring Key Benefits
- Security against the payment default, occurring primarily from the vendors’ end.
- Discount on electrical bills
- Tax exemptions with minimal direct taxes
- Cost waiver on the IPR application
- Access to government e-tenders
- Access to government schemes including Credit Linked Capital Subsidy Scheme, Protection against delayed payments, Credit Guarantee Scheme, and Public Procurement Policy.
- No more hassle to qualify for priority sector lending from banks
- Access to international trade fair with cost-waiver
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Understanding the eligibility of Udyam Registration for MSMEs
Udyam is available to registered entities that align with the MSME classification and belong to the manufacturing, service, and retail sectors. Legally, the following are eligible for Udyam registration after ensuring adherence to the classification cited under the MSME Act 2006.
- Limited Liability Partnerships (LLPs)
- Individuals, startups, business owners, and entrepreneurs
- Co-operative societies
- Private and public limited companies
- Sole proprietorship
- Trusts
- Self Help Groups (SHGs)
- Partnership firm
Documents concerning Udyam Registration for MSMEs
As such you do not need to arrange a myriad of paperwork to apply for MSME registration. Dossiers like company registration, SSI permit, Aadhaar, and PAN will be enough to make the cut.
The Udyam Portal is integrated with the tax authority and GST database. Once you apply for the registration, the portal automatically fetches the required details, including turnover and investment.
How to secure Udyam Registration for MSMEs?
MSME registration can be applied and secured online on the portal viz. Udyam Registration. There are two categories (shown below) under which you can apply for the MSME registration:
- For Entrepreneurs with EM-II or those who have yet to secure the MSME registration
- For UAM registration holders via Assisted filing
For Entrepreneurs with EM-II or those who have yet to secure the MSME registration
Step 1: Head to the Udyam Registration Portal and select option viz. “For New Entrepreneurs who are not Registered yet as MSME or those with EM-II”
Step 2: On the following window, enter details like Aadhaar number, and name, and then tap on the OTP button.
Step 3: Enter the OTP to verify and head to the PAN verification window.
Step 4: Select the entity type, enter the PAN detail, and hit the tab viz. “Validate PAN” button. The portal shall automatically align with concerned databases to fetch and gauge the entered details.
Step 4: Post PAN verification, you will get the access to application form wherein you must enter the required details concerning yourself and your business.
Step 5: Provide the details concerning yearly turnover and investment made. Confirm the declaration and finally hit the tab viz. Submit and Get the Final OTP.
For UAM registration holders via Assisted filing
Step 1: The UAM registration holder must click the tab viz. “For those having registration as UAM” or “For those already having registration as UAM through Assisted filing” on the home page.
Step 2: Enter the UAM number and undergo OTP verification.
Step 3: Fill out the registration form as advised.
Note: After verifying the details, the authority shall grant the certification on the portal in the downloadable form. The certification shall entail a QR code and a 19-digit number, which authorities can access to fetch the company’s details.
How to check MSME Registration Status?
Use the steps below to gauge the MSME Registration Status:
- Head to the Udyam portal.
- Tap on the option called ‘Print/Verify’
- Click on the option viz. ‘Verify Udyam Registration Number’
- Enter the reference number followed by the captcha and then tap on the Verify tab.
How to download the MSME Registration Certificate?
You can go through the following steps to download the MSME registration from the Udyam portal:
- Head to the Udyam portal.
- Click the ‘Print/Verify > ‘Print Udyam Certificate’
- Provide the Udyam registration number followed by the phone number
- Choose the OTP option and tap the ‘Validate & Generate OTP’ button.
- Enter the received OTP to complete the verification
- Relogin to the portal and download the certificate.
Conclusion
Albeit Udyam registration for MSMEs is not mandatory, it can help them secure endless benefits that ultimately fuel growth. Small-scale industries make a significant contribution to the nation’s economy, and yet they are bound to face numerous obstacles ranging from financial crunches to scarcity of resources. With the launch of this certification scheme, the Indian government strives to provide these industries with the necessary support and scheme so that they can continue to operate and embrace growth.
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