Udyam Registration Process for Existing MSMEs with Udyog Aadhaar
The Indian government has recently introduced the Udyam registration process for micro, small, and medium enterprises (MSMEs). This new registration process replaces the Udyog Aadhaar registration, which was previously used to register MSMEs. Existing MSMEs that have already registered under the Udyog Aadhaar scheme are now required to switch to the Udyam through udyam registration portal.
The MSME registration process for existing MSMEs with Udyog Aadhaar is relatively simple. MSMEs can visit the MSME registration portal and log in using their Udyog Aadhaar number. Once logged in, they can update their details and submit the MSME registration application. The application will be verified by the concerned authorities, and upon approval, the MSME will receive a Udyam registration certificate with a unique Udyam registration number (URN).
The MSME registration process is aimed at simplifying the registration process for MSMEs and providing them with various benefits and incentives. The registration process is entirely online, and it is free of cost. It also offers additional benefits such as ease of availing government schemes and subsidies, preference in government procurement, and access to credit facilities from banks and financial institutions.
MSME Registration: An Introduction and Step-by-Step Application Process
The Micro, Small, and Medium Enterprises Development (MSMED) Act, 2006, recognizes Micro, Small, and Medium Enterprises (MSMEs) as important contributors to India’s economic growth. To streamline and promote the growth of MSMEs, the Government of India has introduced the Udyam registration process. In this article, we will explain what MSME registration is and how to apply for it.
What is Udyam Registration?
Udyam registration is a unique identification number provided to MSMEs that register under the MSME Ministry. It replaces the previous Udyog Aadhaar Memorandum (UAM) process and is now mandatory for all MSMEs to register under Udyam. The MSME registration process is entirely online and can be done without any fees.
Eligibility Criteria for Udyam Registration
The following entities are eligible to apply for MSME registration:
- Sole proprietorships
- Partnership firms
- One-person companies
- Limited Liability Partnerships (LLPs)
- Private Limited Companies
- Co-operative Societies
- Hindu Undivided Family (HUF)
The entity’s annual turnover and investment in plant and machinery or equipment are the criteria used to determine the classification of MSMEs. A micro-enterprise is one where the investment does not exceed Rs. 1 crore and the turnover does not exceed Rs. 5 crore. A small enterprise is one where the investment does not exceed Rs. 10 crores and the turnover does not exceed Rs. 50 crores. A medium enterprise is one where the investment does not exceed Rs. 50 crores, and the turnover does not exceed Rs. 250 crores.
Steps to Apply for MSME Registration
Follow the steps given below to apply for Udyam registration:
Step 1: Visit the official website of Udyam Registration.
Step 2: Enter your Aadhaar number and name as per Aadhaar.
Step 3: Fill in the necessary details such as the name of the enterprise, PAN number, email address, and mobile number.
Step 4: Provide the enterprise’s address and bank account details.
Step 5: Enter the enterprise’s major activity, NIC code, and investment details.
Step 6: Verify the details provided and submit the application.
Step 7: Upon submission, an acknowledgment number will be generated.
Step 8: The authorities will verify the application, and the Udyam registration certificate will be issued.
Importance of Udyam Registration in Accessing Credit Facilities from Banks and Financial Institutions
Access to credit facilities is crucial for the growth and development of MSMEs. However, obtaining credit can be challenging for MSMEs due to various factors such as lack of collateral, low credit scores, and lack of financial literacy. MSME registration can play a vital role in addressing these challenges and enabling MSMEs to access credit facilities from banks and financial institutions.
Udyam registration provides MSMEs with a unique MSME registration number (URN), which is recognized by all government agencies and financial institutions. The URN serves as proof of the MSME’s existence and provides credibility to the business. Banks and financial institutions consider MSME registration as a vital parameter while evaluating loan applications from MSMEs.
Moreover, Udyam registration provides various incentives and benefits to MSMEs, which can help them in obtaining credit facilities. The Udyam registration certificate provides details about the MSME’s operations, turnover, and other essential information that can help banks and financial institutions evaluate the creditworthiness of the business.
Suggested Read- Update Udyam Certificate
In conclusion, MSME registration is an essential step for existing MSMEs with Udyog Aadhaar to access various benefits and incentives provided by the government. The registration process is straightforward, and it can help MSMEs in accessing credit facilities from banks and financial institutions. MSMEs must consider Udyam registration as a crucial step towards growth and development, and take advantage of the benefits it offers.