A Complete Guide to MSME Registration in India 

Businesses who want to avail benefits announced by the government for msme registration their business on the ‘Udyog Aadhaar Memorandum (UAM) portal’. The registration process is straightforward and completely free for all users.

Following are the Steps to Register Business Online: 

1. Visit the UAM portal where you will be required to fill a form
2. If you are registering your business as an MSME for the first time, click on the first link on the page to open the form
3. Enter the Aadhaar Number and Name and click on ‘Validate & Generate OTP’
4. Once verification is done, you will have to fill in the PAN details. You can select the No option if you don’t have a PAN card yet
5. Post this, you will have to fill the form having field numbers 5-24
6. At the end of the form, an OTP request will be sent to your phone again. Enter the OTP and verification code to submit the form successfully
7. After successful registration, a “Thank You” message will appear with a Registration Number. Keep that number handy for future reference
8. Once the application form is submitted, it can take 2-3 days for the approval and registration to complete
9. If the application gets approved, the registration will be done and the MSME certificate will be delivered to you via email

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Benefits of MSME Registration

Registration of your MSME is not mandatory. If you opt to register, your company will be eligible for an excise exemption plan from direct taxes, as well as special bank schemes tailored to MSMEs.

Additionally, firms who are registered and have an MSME certificate will receive benefits from several government offices, including electricity.

Here are some of the benefits: 

Lowest interest rates on bank loans 

Avail tax rebates customized for MSMEs credit for Minimum Alternate Tax (MAT) 

Very easily accessible credit for MSMEs 

Reimbursement of ISO Certification 

Avail special rebates and concessions on patents and industry set-ups 

One time settlement fee for the amount unpaid 

Government preference to MSMEs 

Concession in electricity bills 

Get credit guarantee schemes from the Government 

Special consideration on International Trade fairs

Barcode registration subsidy 

Support from your state government

MSME schemes launched by the Government

Documents Required for MSME Registration

Aadhaar number, PAN number, Address of the business, Bank account number, The basic business activity, NIC 2 digit code, Investment details (Plant/equipment details), Turnover details (as per new MSME definition), Partnership deed, Sales and purchase bill copies, Copies of licenses and bills of purchased machinery.

Details Required for MSME Registration:

ADHAR card of the Applicant (Proprietor/ Partner / Director)

Name of Applicant

Caste

Business Name

Type of Business Entity

Address of the Plant

Address of the Office

Date of Commencement of the Business

How to register MSME without Aadhaar Card?

According to the section-3 act, applicant who doesn’t have an Aadhaar card, UAM registration shall be filed by the respective DIC or MSME-DE for the enterprise or business till the time an individual receives the Aadhaar.

Meanwhile, the individual can provide the below documents as an alternative for identification.

Aadhaar enrolment copy, Aadhaar enrolment request copy

Anyone of the following: Voter Id, passport, driving license, PAN card, employee ID, and bank passbook

MSME Registration Criteria

The maximum revenue criteria for the registration of MSME set by the government are:

According to the MSMED Act, 2006, also known as Micro, Small and Medium Enterprises Development Act:

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MSME in the manufacturing sector can be identified if: 

Micro enterprises – The investment doesn’t exceed Rs 25 lakh 

Small enterprises – The investment is more than Rs 25 lakh but doesn’t exceed Rs 5 crore

Medium enterprises – The investment is more than Rs 5 crore and doesn’t exceed Rs 10 crore 

MSME in the service sector can be identified if: 

Micro enterprises – The investment doesn’t exceed Rs 10 lakh 

Small enterprises – The investment is more than Rs 10 lakh but does not exceed Rs 2 crore 

Medium enterprises – The investment is more than Rs 2 crore but doesn’t exceed Rs 5 crore

This definition of MSME has been recently amended on the 13th of May 2020 by the central government. Investments are no longer the only parameter to define MSME. Finance Minister Nirmala Sitharaman has added ‘annual turnover’ as an additional principle along with the ‘investment in plant and machinery’.