Udyam Registration 2024: A Step-by-Step Guide

Udyam Registration 2024: A Step-by-Step Guide

There are more than 6 crore MSMEs in India, and more than 11 crore people are employed by MSMEs.

Yet micro, small, and medium-sized enterprises (MSMEs) face several challenges, such as limited capital, less exposure, and more. 

The MSME sector contributes to many industries, but the sector is quite scattered and has to face intense competition from market leaders. Udyam Registration is a process that empowers and simplifies the registration of MSMEs. Udyam registration has been the buzzword in 2024 as more and more MSMEs are emerging. If you're an MSME, Udyam registration is more important than ever in 2024. 

Have no clue about Udyam Registration? No need to worry - here is a step-by-step guide for seamless Udyam Registration 2024.

What is Udyam Registration?

Udyam registration is a government recognition program for Micro, Small, and Medium Enterprises (MSMEs). It was launched by the Government of India on May 13, 2020, and is a substitute for Udyog registration. MSMEs can do Udyam registration online, and it is a swift process. When it comes to convenience and benefits, Udyam registration tops the previous Aadhaar Udyog registration.

Udyam registration is a significant step for MSMEs to gain recognition, access benefits, and simplify compliance. It's a quick and easy process that can empower your business for growth.

Benefits of Udyam Registration 

A major reason that Udyam registration has been so successful and a lot of MSMEs have opted for it is because it provides numerous benefits to MSMEs. Even though MSMEs contribute a lot to different industries (more than 36% of total manufacturing output), they have their fair share of challenges. Applying for Udyam registration solves a lot of problems for MSMEs. Here are some top benefits of Udyam registration. 

Get Government Tenders: MSME Udyam registration makes MSMEs eligible to participate in tenders specifically reserved for MSMEs. Winning a government tender is a big deal for any MSME and Udyam registration takes you one step closer to it.

Eligibility for Government Schemes: With Aadhaar Udyam registration, MSMEs can access numerous government schemes. Registered MSMEs get tariff subsidies and capital tax subsidies. There are various tax rebates available exclusively for Udyam. 

Get Loans at lower rates: Capital is a major issue for MSMEs and Udyam Registration solves that. With Udyam registration you can get business loans from banks and non-banking financial corporations (NBFCs) at lower interest rates.

Simplified Process: Udyam registration is a process that eliminates the need for multiple registrations. With Udyam registration, you can get government approvals, licenses, and registrations for your business.

Why Udyam Registration Matters Now More than Ever in 2024?

Since its inception in 2020, Udyam Registration has been vital, but it is more important than ever in 2024. From 1 April 2024, a new regulation will be implemented that will ensure timely payments to MSMEs. MSMEs work with limited capital and struggle to get payment from their clients, which affects their operations. 

The Finance Act 2023 introduced an amendment to the Income Tax Act by adding clause (h) to Section 43B. This clause stipulates that any payments owed to MSMEs not resolved within 45 days will not qualify for tax deductions until the payment is made.

This amendment motivates businesses to prioritize their settlements with MSMEs and improves the economic environment for smaller businesses. As a small business, if you want to receive payments on time, it is crucial for MSME apply online for Udyam registration. 

How to complete your Udyam Registration?

Excited about the benefits of Udyam registration and its ever-increasing significance in 2024? To avail the benefits of Udyam registration, you will need to complete the Udyam registration form. Once you complete the registration process, you will get a Udyam Registration Certificate.

Here is a step-by-step guide for smooth and simple Udyam Registration:

Step 1: Visit the official Udyam registration portal at https://udyamregistration.gov.in/.

Step 2: On the homepage, click the option 'For new entrepreneurs who are not registered yet as MSME or those with EM-II.'

Step 3: Enter the 'Aadhaar Number' and the 'Name of Entrepreneur,' then click the 'Validate & Generate OTP' button.

Step 4: An OTP will be sent to the mobile number linked with your Aadhaar. Enter the OTP and click "Validate."

Step 5: Once the Aadhaar is validated, proceed to the PAN verification page. Enter the 'Type of Organization' 'PAN' number, and click the 'Validate' button. Also, indicate whether you have filed the previous year's ITR and if you have a GSTIN.

Step 6: The Udyam registration application form will appear. Fill in all required details.

Step 7: Then click the submit button and get an OTP. Select the declaration.

Step 8: Enter the OTP received and submit the form. You will receive the Udyam e-registration certificate in your email.

Additional Tips for Udhyam Registration:

Keep Documents Handy: While Aadhaar is the primary document, having your PAN card details readily available can expedite the MSME registration process.

Accurate Information: Ensure all details entered are accurate and up-to-date to avoid any delays.

Save Registration Details: Save your Udyam registration number and certificate for future reference.

Eligibility Criteria for Udyam Registration

The Udyam registration process has a plethora of benefits for small and emerging businesses, but the business should fulfil the eligibility criteria. Any business that falls under the MSME (Micro, Small and Medium Enterprise) classification based on investment in plant and machinery or equipment and annual turnover is eligible for Udyam registration.

Here is the table of eligibility criteria for a business to qualify as an MSME in India:

Conclusion 

Udyam registration is a monumental process that has a plethora of benefits for MSMEs. Applying for Udyam registration is simple, but can Udyam registration be cancelled? Udyam registration can be cancelled swiftly through a simple process. With the above step-by-step guide, you can complete Udyam registration and empower your business. 

Frequently Asked Questions

What is Udyam Registration?

Udyam Registration is a government portal in India for registering micro, small, and medium enterprises (MSMEs). It replaced the earlier system of EM-I/II and UAM registration.

Who can register under Udyam Registration?

Any entity involved in manufacturing or providing services and meeting the criteria for micro, small, or medium enterprises as per the MSME Act, 2006, can register under Udyam.

What are the criteria for classification as a micro, small, or medium enterprise?

Micro-enterprises:Investment in plant and machinery or equipment does not exceed one crore rupees and turnover does not exceed five crore rupees.

Small enterprises:Investment in plant and machinery or equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees.

Medium enterprises:Investment in plant and machinery or equipment does not exceed fifty crore rupees and turnover does not exceed two hundred fifty crore rupees.

Is Udyam Registration mandatory?

Yes, Udyam Registration is mandatory for all MSMEs in India.

How to register under Udyam Registration?

You can register online on the official Udyam Registration portal https://udyamregistration.gov.in/

What documents are required for Udyam Registration?

Aadhar card of the owner/partner/director, PAN card, GSTIN (if applicable), business address proof, and details of the enterprise such as turnover, investment in plant and machinery, etc.

Is there any fee for Udyam Registration?

No, there is no fee for Udyam Registration.

Can an enterprise update its information after registration?

Yes, an enterprise can update its information online on the Udyam Registration portal.

What are the benefits of Udyam Registration?

Benefits include easier access to credit, subsidies, government schemes, and various incentives provided by the government for MSMEs.

Is Udyam Registration valid for a lifetime?

No, Udyam Registration needs to be renewed periodically. The exact duration for renewal is not specified yet, but it is generally expected to be valid for a few years.