MSME stands for Micro, Small, and Medium Enterprises, and such industries are the backbone of the economy in a developing country like India. When these industries expand, the country's economy as a whole expands and flourishes. Therefore, any company that falls into the MSME category must ensure that they are registered under the prevailing act.
Whether it is a company from the manufacturing or service background, registrations for both can be acquired under the MSME Act. The government has not yet made this registration mandatory, but it is advantageous to have one's business registered under this because it provides numerous benefits in terms of taxation, business setup, credit facilities, loans, etc.
The new Udyam portal from the Ministry of Micro, Small, and Medium Enterprises is a self-declaration and cost-free platform for entrepreneurs to register their businesses. The integration of the Income Tax and GSTIN systems on the Udyam portal automatically retrieves PAN and GST-related investment information.
You can grow your business with a collateral-free business loan!
Step-by-Step MSME Registration Process
Now that you understand why MSME registration is essential, the next step is to get started on how to register a business as an MSME. This registration requires the submission of a few documents, including personal information, company information, and so on. Follow the below steps to register your small business:
Step 1. Visit the UAM portal to fill the required form.
Step 2. If this is your first time registering your MSME, simply click here to open the form.
Step 3. Enter your Aadhaar number and name, then click the 'Validate & Generate OTP' button.
Step 4. After you have completed the verification process, you must enter your PAN information. If you do not yet have a PAN card, you can select ‘No’.
Step 5. Fill out the form with the numbers 5-24. An OTP request will be sent to your phone again at the end of the form. To successfully submit the form, enter the OTP and verification code.
Step 6. Following successful registration, a ‘Thank You’ message with a Registration Number will appear. Keep that number noted for future use.
Step 7. Once the application form is submitted, the approval and registration process can take up to 2-3 days.
Step 8. If your application is approved, you will be registered, and your MSME certificate will be emailed to you.
Details Required for MSME Registration
- PAN number
- Aadhar number
- The company's address
- Bank account number
- The fundamental business activity
- NIC two-digit code
- Investment specifics (plant/equipment specifics)
- Specifics on turnover (as per new MSME definition)
- Partnership agreement
- Copies of sales and purchase bills
- Copies of licenses and purchase invoices for purchased machinery
Benefits of MSME Registration
If you choose to register, your company will be eligible for an excise exemption scheme from direct taxes, as well as special bank programs tailored to MSMEs. Moreover, registered businesses with an MSME certificate can avail of several benefits from various government departments.
Some of the benefits of MSME registration:
- Avail of loans collateral free
- Subsidy on trademark filing
- Take advantage of tax breaks tailored to MSMEs for the Minimum Alternate Tax (MAT)
- ISO Certification Reimbursement
- Take advantage of special rebates and concessions on patents and industrial setups
- There will be a one-time settlement fee for the amount owed
- MSMEs are given preference by the government
- Electricity bill concession
- Obtain credit guarantee programs from the government
- Special consideration should be given to international trade fairs
- Subsidy for barcode registration
We hope that this article clarifies any confusion about the benefits and procedure of MSME registration for small business entrepreneurs in India. If you haven’t already, get started on registering your business today!
- Udyam Registration
- MSME Registration
- Udyog Aadhaar