If you are planning to start your business, then first of all, you have to understand the advantage of MSME registration, and it can help you in making the right decision regarding your business. Through this article, we will explore the benefit of Udyam registration, how it can help in getting your business going, and how you will be able to register your enterprise by just following simple steps.
What is MSME Registration?
MSME Registration, also known as Udyam Registration, is an online process introduced by the Government of India to recognise small businesses and provide them with many benefits so that they can dominate in this competitive market. This registration is based on how much investment your business has in plant and machinery and what your turnover is. In this, businesses are divided into three categories.
- Micro Enterprises: Investment up to Rs. 2.5 crore & Turnover up to Rs. 10 crore
- Small Enterprises: Investment up to Rs 25 crore. & Turnover up to Rs 100 crore
- Medium Enterprises: Investment up to Rs. 125 crore & Turnover up to Rs. 500 crore
Although earlier, their investment and turnover amount was different, in Budget 2025, their investment and turnover limit has been increased.
Businesses that register themselves in Udyam Registration Online can access many government incentives, tax benefits, and financial assistance. Along with this, they also get loans at low interest rates from banks and NBFCs and also get some protection in case of delay in payment. Next, we understand the advantage of the Udyam Registration Certificate for new businesses.
What are the advantages?
- Obtaining access to government programs and subsidies:
Being eligible for different government programs and incentives is one of the main advantages of MSME registration. These consist of the following:
- The Credit Linked Capital Subsidy Scheme (CLCSS) offers funding for technological advancement.
- A percentage of government tenders are set aside for MSMEs according to the Public Procurement Policy.
- The MSME Competitive Lean Scheme promotes efficiency gains and cost savings.
- These programs assist start-up companies in cutting expenses and increasing their effectiveness.
- Simple Access to Credit and Business Loans
- Through programs like the Credit Guarantee Fund Trust for Micro and Small Enterprises, the government provides MSMEs with low-interest financing choices and loans without collateral.
- MUDRA Loan Program
- The Stand-Up India Program
Your company can easily get operating capital and expansion funding without pledging assets if it is registered as an MSME.
- Reduced Bank Loan Interest Rates
- Loans for registered MSMEs are available at lower interest rates, frequently ranging from 1 to 1.5% less than those for ordinary company loans.
- Preferential lending to MSMEs is offered by several banks and NBFCs, which facilitates startup financial management.
- Not subject to direct taxes
- Under several government programs, MSMEs are eligible for income tax exemptions. Advantages consist of Presumptive Taxation Scheme (PTS) tax refunds.
- GST exemption is available to companies with annual revenue under ₹40 lakh (₹20 lakh for service providers).
- Subsidies for industrial promotion and concessions on patent registration New firms benefit from lower taxes and increased profitability as a result.
- Defence Against Postponed Payments:
- Late payments are a common problem for new firms.
- The MSME Development Act of 2006 permits registered to get interest on payments that are past due by more than forty-five days.
- Utilise the MSME Samadhaan Portal to settle issues.
- For young enterprises, this guarantees a consistent cash flow and financial stability.
- Government Tender Priority:
A specific portion of the government's procurement contracts is set aside for MSMEs.
- If your company is registered as an MSME, you receive Earnest Money Deposit (EMD) exemptions.
- Preference in public procurement policy-governed government tenders.
- GeM (Government e-Marketplace) is easier to use for delivering goods and services.
- This aids new businesses in growing and obtaining significant government contracts.
- Assistance for the Registration of Patents and Trademarks
The government provides the following to foster innovation and safeguard intellectual property processing.
- 50% off the cost of registering a patent.
- Lower expenses for MSMEs to register their trademarks.
- Quicker patent application processing.
- These advantages have the potential to drastically cut expenses if your new company offers a distinctive good or service.
- Electricity Bill Concession
- Electricity bill reductions are available to registered MSMEs, which lowers operating expenses.
- To help new enterprises cut costs, several state governments offer MSME units subsidised power bills.
- Simple Business Growth Possibilities
- Businesses that register as MSMEs can apply for subsidies from the government for projects involving expansion.
- Financial assistance for attending foreign trade shows.
- Support for infrastructure and technological upgrades.
- This facilitates the expansion and global competition of new enterprises.
- Increased Credibility and Market Reach
- An MSME registration certificate increases a startup's marketability.
- Advantages include heightened confidence among investors and consumers.
- Eligibility to apply for incubator and business accelerator programs.
- Recognition in trade directories and business-to-business platforms.
This aids new businesses in making a solid name for themselves in their fields.
How to Register MSME in Udyam Registration Online Process
You can register MSME yourself in Udyam Registration, which is a very simple and 100% online process. Just follow the given steps:
Step 1: First of all, visit an authentic Udyam Registration Online Portal.
Step 2: After opening the website, you will see the New Udyam Registration Online Form displayed on the home page itself.
Step 3: In the MSME registration form, you have to fill in your personal information and company information.
In personal information
- Enter Applicant's name
- Enter Mobile number
- Enter Email ID
- Choose a social category from the drop-down box.
- Choose a gender from the drop-down box.
- Choose whether you are physically handicapped or not from the drop-down box.
In company information
- Enter Business name, Business address, and commencement of the business
- Enter Pin code
- Choose state and district from the drop-down box.
- Choose the type of your organisation from the organisation box. For example, proprietorship, partnership firm, etc.
- Choose the main activity of the business, like service provider, manufacturer, or trade.
- Enter total investment and annual turnover.
- Give the details of your documents like Aadhar number, PAN card number, bank name, bank account number, IFSC code, and GST number.
Note: If you are not registered in GST, then leave that field blank.
- Give the details of your employees; how many male, female, and other employees are there in your organisation?
- Give additional details of your business.
Step 4: In the MSME registration form, you will see a verification code or capture; tick mark it in the given box.
Step 5: Tick mark in the box of Terms of Service and Self-Declaration
Step 6: Finally, check the information once properly and submit it.
After paying a nominal fee, you will receive your Udyam Registration Number in your registered email ID within 24 to 48 hours, and you can also print the Udyam Certificate download PDF form.
Conclusion
MSME registration under the Udyam Certificate online can offer a lot of benefits that help new businesses to drive themselves from financial assistance to tax benefits provided by the government through subsidies and market support, which gives MSMEs a lot of advantages and enhances their business growth.
If you are starting your business, then registering under MSME is a very smart move, which gives you access to government incentives and enhances credibility. Do not miss out on all the benefits of Udyam registration and get your business registered under MSME today and maintain the dominance of your business in this competitive market.