Udyam Registration - Importance & Eligibility

By Author: udyam registration
Total Articles: 1
Comment this article

Introduction
Udyam Registration is a government initiative designed to simplify the process of registering and classifying micro, small, and medium enterprises (MSMEs) in India. Launched by the Ministry of Micro, Small and Medium Enterprises (MSME), it replaces the earlier process of obtaining an MSME registration (Udyog Aadhaar).
The Udyam Registration portal aims to provide MSMEs with a single-window system for registration and facilitates ease of doing business. It enables businesses to avail of various benefits provided by the government such as subsidies, schemes, and easier access to credit from banks and financial institutions.
This registration is mandatory for all MSMEs, allowing them to declare their existence and details without any cost. It provides a unique identification number known as Udyam Registration Number (URN) for each enterprise, which simplifies their participation in government tenders and other business opportunities.
In essence, Udyam Registration plays a pivotal role in fostering the growth and development of MSMEs by offering them recognition, support, and opportunities to ...
... thrive in the competitive market landscape of India.
Eligibility of udyam registration
Udyam Registration is open to entities that qualify as micro, small, or medium enterprises (MSMEs) under the criteria defined by the Government of India. Here’s a breakdown of who is eligible for Udyam Registration:
Micro Enterprises:
Manufacturing enterprises: Investment in plant and machinery does not exceed Rs. 1 crore.
Service enterprises: Investment in equipment does not exceed Rs. 1 crore.
Small Enterprises:
Manufacturing enterprises: Investment in plant and machinery is more than Rs. 1 crore but does not exceed Rs. 10 crore.
Service enterprises: Investment in equipment is more than Rs. 1 crore but does not exceed Rs. 10 crore.
3. Turnover Criteria (effective from July 1, 2020):
Micro Enterprises: Turnover does not exceed Rs. 5 crore.
Small Enterprises: Turnover is more than Rs. 5 crore but does not exceed Rs. 50 crore.
Medium Enterprises: Turnover is more than Rs. 50 crore but does not exceed Rs. 250 crore.
Process of udyam registration
The process for Udyam Registration is relatively straightforward and can be completed online through the official Udyam Registration portal provided by the Ministry of Micro, Small and Medium Enterprises (MSME), Government of India. Here’s a step-by-step guide to the process:
Access the Udyam Registration Portal:
Visit the official Udyam Registration portal: http://udyog-adhaar.in/
New Registration:
Click on the "For New Entrepreneurs who are not Registered yet as MSME" link on the portal's homepage.
Aadhaar Verification:
Enter your 12-digit Aadhaar number and verify it through OTP (One Time Password) sent to your registered mobile number.
Personal Details:
Fill in your name, mobile number, email address, and create a password to register your account.
Enterprise Details:
After logging in, provide details about your enterprise, such as:
Name of the enterprise
Type of organization (proprietorship, partnership, LLP, company, etc.)
PAN (Permanent Account Number) of the enterprise
Location of the enterprise
Date of commencement of business
Classification of Enterprise:
Classify your enterprise as micro, small, or medium based on:
Investment in plant & machinery/equipment (for manufacturing enterprises)
Investment in equipment (for service enterprises)
Turnover (effective from July 1, 2020)
Additional Information:
Provide additional details such as NIC Code (National Industrial Classification) of your business activities, bank account details, etc.
Submit Application:
Review all the information entered for accuracy and completeness.
Click on the "Submit" button to proceed.
Confirmation and Acknowledgment:
Once submitted successfully, an acknowledgment containing your Udyam Registration Number (URN) will be generated.
This URN will also be sent to your registered email address.
Print Certificate:
After receiving the URN, you can download and print the Udyam Registration certificate from the portal for your records.
Importance of udyam registration
Recognition and Legal Protection:
Udyam registration provides formal recognition as an MSME entity. This recognition is crucial for availing various benefits and schemes specifically designed for MSMEs by the government, financial institutions, and other bodies.
Financial Benefits:
MSMEs registered under Udyam are eligible for priority sector lending at lower interest rates from banks. They also have access to various government subsidies, schemes, and incentives aimed at promoting the growth and development of small businesses.
Ease of Doing Business:
Registration under Udyam simplifies various compliance processes such as obtaining licenses, permits, and registrations. It reduces bureaucratic hurdles and facilitates smoother business operations.
Priority in Government Procurement:
MSMEs registered under Udyam can participate in government tenders and procurements reserved exclusively for them. This provides opportunities to secure business from government agencies.
Subsidies and Exemptions:
Registered MSMEs may benefit from subsidies on products or services they produce, as well as exemptions under direct tax laws in some cases.
Access to Credit and Finance:
Udyam registration enhances credibility and trust among financial institutions, making it easier for MSMEs to access credit facilities, loans, and other financial assistance needed for business expansion and investment.
Promotion of Entrepreneurship:
By encouraging MSME registration, the government promotes entrepreneurship and fosters economic growth by creating job opportunities, particularly in rural and backward areas.
Technology and Skill Development:
MSMEs registered under Udyam can benefit from government schemes aimed at enhancing technological capabilities, skill development, and quality improvement through specialized training programs.
Benefits of udyam registration
Government Recognition and Support:
Formal recognition as an MSME by the Government of India, which is essential for availing various benefits, incentives, and support schemes exclusively designed for MSMEs.
Ease of Obtaining Licenses, Permits, and Registrations:
Simplified process for obtaining licenses, permits, and registrations required for starting and operating a business, reducing bureaucratic red tape.
Financial Support and Credit Facilities:
Easier access to bank loans, credit facilities, and other financial assistance as banks and financial institutions prioritize lending to registered MSMEs due to their recognized status.
Preferential Treatment in Government Procurement:
Preference in government procurement tenders, ensuring a certain percentage of purchases are reserved for MSMEs to promote their participation in the government supply chain.
Exemption under Direct Tax Laws:
Various direct tax exemptions, such as exemption under the Income Tax Act in the initial years of business operations, facilitating savings and improving profitability.
Concession in Electricity Bills:
MSMEs often receive concessions or subsidies on electricity bills to reduce operational costs and improve competitiveness.
Interest Rate Subsidy on Bank Loans:
Subsidized interest rates on loans provided by banks, lowering the cost of borrowing and making funds more affordable for business expansion and modernization.
Access to Trade Credit and Protection against Delayed Payments:
Facilitated access to trade credit from banks and other financial institutions, along with government-backed schemes to protect MSMEs against delayed payments from buyers.
Technical and Business Support:
Access to support services for technology upgradation, quality certification, market development, and entrepreneurship development programs to enhance business capabilities.
Enhanced Market Access and Export Opportunities:
Assistance in participation in international trade fairs and exhibitions under government initiatives to promote MSME products and services globally.
Note :- Apply for udyam Re- Registration through udyam portal.
Conclusion
In conclusion, Udyam Registration stands as a pivotal initiative by the Government of India to empower micro, small, and medium enterprises (MSMEs) and foster their growth in the competitive business landscape. By obtaining Udyam Registration, MSMEs gain formal recognition, access to a multitude of benefits, and support systems designed to streamline operations and stimulate expansion.
This registration not only simplifies the bureaucratic process of establishing a business but also opens doors to financial assistance, preferential treatment in government procurement, tax exemptions, and subsidies on essential services like electricity. Moreover, it facilitates easier access to credit from banks, which is crucial for investment in infrastructure, technology, and overall business development.