MSME Registration In India: Procedure, Documents Required

MSME industries are the backbone of the economy. They are also known as Small Scale Industries (SSIs). The government of India provides an MSME registration to the industries classified by the government as Micro, Small and Medium Enterprises (MSME) in India. The MSME registration helps MSMEs to obtain various benefits provided by the government for their establishment and growth. 

What is MSME Classification?

Initially, when the government introduced the MSME registration in 2006, the MSME classification was based on the investment criteria in plant and machinery or equipment. The government revised the MSME classification by inserting annual investment and annual criteria. Also, the distinction between the manufacturing and the services sectors under the MSME definition was removed.

The following is the current revised MSME classification, where the investment and annual turnover are to be considered for deciding if an entity is considered as an MSME:

What is MSME Udyam Registration? 

MSME registration is also called Udyam registration. The entities that fulfil the MSME classification can apply for MSME registration from the government portal, the Udyam portal. The MSME registration is entirely online and can be obtained from the Udyam registration portal. It is not mandatory for MSMEs to obtain this registration, but it is beneficial to get one’s business registered under this because it provides a lot of benefits in terms of taxation, setting up the business, credit facilities, loans etc.

MSME Registration Eligibility

All manufacturing, service industries, wholesale, and retail trade that fulfil the revised MSME classification criteria of annual turnover and investment can apply for MSME registration. Thus, the MSME registration eligibility depends on an entity’s annual turnover and investment. The following entities are eligible for MSME registration:

• Individuals, startups, business owners, and entrepreneurs
• Private and public limited companies
• Sole proprietorship
• Partnership firm
• Limited Liability Partnerships (LLPs)
• Self Help Groups (SHGs)
• Co-operative societies
• Trusts

Documents Required for MSME Registration

The MSME registration documents are as follows:

• Aadhaar card
• PAN card

There are no MSME registration fees and it does not require proof of documents. PAN and GST-linked details on investment and turnover of enterprises will be taken automatically by the Udyam Registration Portal from the Government databases since the portal is integrated with Income Tax and GSTIN systems.

GST registration is not compulsory for enterprises that do not require a GST registration. However, enterprises that mandatorily need to obtain GST registration under the GST law, must enter their GSTIN for obtaining the MSME Registration or Udyam Registration.

How to Apply for MSME Registration on Udyam Registration Portal?

 The MSME registration process is entirely online. MSME online registration is to be done on the government portal of udyamregistration.gov.in. There is no MSME registration fee charged for registration. MSME registration online can be done under the following two categories in the portal –

1. For New Entrepreneurs who are not Registered yet as MSME or those with EM-II and
2. For those having registration as UAM and For those already having registration as UAM through Assisted filing

For New Entrepreneurs who are not Registered yet as MSME or those with EM-II

Step 1: New entrepreneurs and entrepreneurs having EM-II registration need to click the button “For New Entrepreneurs who are not Registered yet as MSME or those with EM-II” shown on the home page of Udyam Registration Portal.  
 

Step 2: On the next page, enter the Aadhaar number and the name of the entrepreneur and click on the “Validate and Generate OTP Button”. Once this button is clicked and OTP is received and entered, the PAN Verification page opens.

Step 3: The entrepreneur must enter the “Type of Organisation” and the PAN Number and click on the “Validate PAN” button. The portal gets the PAN details from the government databases and validates the PAN number of the entrepreneur. 
 

Step 4: After verification of PAN, the Udyam Registration form will appear, and the entrepreneurs need to fill in their personal details and details of their enterprise.

Step 5: Enter the investment and turnover details, select the declaration, and click on the “Submit and Get Final OTP” button. The OTP is sent, and after entering the OTP and submitting the form, the Udyam Registration Certificate will be sent through email. Entrepreneurs can also find out the MSME registration status from the Udyam Registration Portal. 

Registration For Entrepreneurs Already Having UAM

For those already having UAM registration, they need to click the button “For those having registration as UAM” or “For those already having registration as UAM through Assisted filing” shown on the home page of the government portal. This will open a page where Udyog Aadhaar Number is to be entered, and an OTP option should be selected.

The options provided are to obtain OTP on mobile as filled in UAM or obtain OTP on email as filled UAM. After choosing the OTP Options, “Validate and Generate OTP” is to be clicked. After entering OTP, registration details are to be filled on the MSME registration form, and Udyam registration will be complete.

MSME Registration Fees

There are no fees charged by the government for MSME registration. It is free of cost on the official website, i.e. Udyam Portal.

MSME Registration Certificate

The Ministry of MSME issues an e-certificate known as the Udyam Registration Certificate to MSMEs in India. The Udyam registration certificate is known as the MSME registration certificate. The entrepreneurs receive the MSME registration certificate upon completion of the MSME registration process. The certificate will contain a QR Code, from which the enterprise details can be accessed.

MSME Registration Number

An enterprise having an MSME registration is known as Udyam, and the permanent identity number assigned to by the Ministry of MSME is known as the ‘Udyam/MSME Registration number’. The MSME Registration Certificate will contain the 19-digit MSME/Udyam Registration Number. 

MSME Registration Status 

Below is the process to check MSME Registration Status:

• Visit the Udyam registration portal.
• Click on the ‘Print/Verify’ option and click on the ‘Verify Udyam Registration Number’ option.
• Enter the ‘Reference Number’, enter the captcha code and click on the ‘Verify’ button. 

MSME Registration Certificate Download 

Below is the process to download the MSME Registration Certificate:

• Visit the Udyam registration portal.
• Click the ‘Print/Verify’ option and select the ‘Print Udyam Certificate’ option.
• Enter the ‘Udyam Registration Number’, ‘Mobile’, choose the OTP option and click on the ‘Validate & Generate OTP’ button. 
• Enter the OTP received on the mobile/email and click on the ‘Validate OTP and Login’ button.
• After logging in, take a printout of the Udyam registration certificate.

MSME Registration Benefits

Below listed are the MSME registration benefits:

• Due to MSME Registration India, bank loans become cheaper as the interest rate is very low, around 1-1.5%, much lower than interest on regular loans
• It also allowed credit for minimum alternate tax (MAT) to be carried forward for up to 15 years instead of 10 years
• Once registered the cost of getting a patent done, or the cost of setting up the industry reduces as many rebates and concessions are available
• MSME registration helps to acquire government tenders easily as Udyam Registration Portal is integrated with Government e-Marketplace and various other State Government portals which give easy access to their marketplace and e-tenders
• There is a One Time Settlement Fee for non-paid amounts of MSME
• The MSME registration will help the MSMEs in availing the benefits of government schemes such as the Credit Guarantee Scheme, Credit Linked Capital Subsidy Scheme, Public Procurement Policy, Protection against delayed payments, etc.
• MSMEs are eligible for priority sector lending from banks
• MSMEs get the benefit of a government security deposit waiver that is helpful while participating in e-tenders
• Any number of activities, including service or manufacturing or both, may be added or specified in one MSME registration
• Barcode registration subsidy
• Exemption scheme from direct taxes
• ISO certification fees reimbursement
• Electricity bills concession
• Special consideration in International trade fairs

How to check MSME registration by name?

You cannot check the MSME registration number by name. However, you can retrieve your MSME registration number by following the below process: 

• Visit the Udyam Registration Portal.
• Click on the ‘Forgot Udyam/UAM No.’ option under ‘Print/Verify’ option on the homepage.
• Choose the registration option.
• Choose the OTP option.
• Enter the mobile/email address.
• Click on the ‘Validate & Generate OTP’ button.
• Enter the OTP. The MSME registration number will be displayed.

Related Articles

Udyamregistration.gov.in – Government Portal

Documents Required for MSME registration in India

MSME CHAMPIONS – A peek into the future of MSME

Section 43B(h) of Income Tax Act: New MSME 45 Days Payment Rule