Home » Wealth Corner » The importance of the Udyam Registration certificate for your MSME

The importance of the Udyam Registration certificate for your MSME

Did you know Udyam Registration is mandatory for MSMEs? Discover what it means for your business and the advantages you can't ignore.

importance of the Udyam Registration

Micro, Small, and Medium Enterprises (MSMEs) are undeniably the spine of the Indian economy, creating over 160 million jobs across various sectors and contributing to 33% of India’s GDP. 

In recognition of their critical importance, the government introduced Udyam Registration, a streamlined process designed to simplify the registration of MSMEs. Prior to Udyam Registration, the procedure was laborious and time-consuming. Thanks to Udyam Registration, businesses may now register much more easily and, facilitating easier access to larger benefits.

Over 36 million enterprises have already received the Udyam Registration certificate, leveraging its advantages for their growth and sustainability. But the question remains, is your MSME among them? If not, this blog will guide you through the importance of Udyam Registration and how you can take advantage of its benefits for your business.

Why does MSME require a Udyam Registration certificate?

The first method used by the Ministry of MSME for small and medium-sized business registration was MSME Registration, formerly called Udyog Aadhar. Businesses were able to validate their operational and legal status as small to medium enterprises by using this method to obtain a UAM number (Udyog Aadhaar Memorandum).

With the introduction of Udyam Registration on 1st July 2020, the process received an upgrade. This new registration conforms to the updated criteria of classification based on both investment and turnover, as notified by the government on 26th June 2020. It is designed to facilitate ease of doing business, making it mandatory for existing MSMEs registered under Udyog Aadhar to migrate to this new system.

Udyam Registration is a compulsory government-issued certification that recognises and categorises businesses as micro, small, or medium Enterprises based on the latest criteria. This certification comes with a unique identification number and e-certificate, simplifying access to a range of benefits such as subsidies, exemptions, concessions, and the ease of applying for government tenders.

Classification of MSME under Udyam Registration

Businesses are categorised under Udyam Registration according to their yearly turnover and investment in plant and machinery or equipment. Here’s the classification:

Type of EnterpriseInvestment in Plant and Machinery or EquipmentAnnual Turnover
Micro EnterpriseDoes not exceed ₹1 croreDoes not exceed ₹5 crore
Small EnterpriseDoes not exceed ₹10 croreDoes not exceed ₹50 crore
Medium EnterpriseDoes not exceed ₹50 croreDoes not exceed ₹250 crore

Also read: 35% of Gujarat’s MSME steel sector succumb to Chinese pressure in Q2

Udyam certificate registration process

Businesses must re-register in order to be in compliance with the new Udyam Registration if they were previously registered under EM-II, UAM, or any other MSME body. It’s crucial to remember that, regardless of size or industry, a business may only have one Udyam Registration. Nonetheless, the same registration may be used for more than one activity.

The Udyam certificate registration  is a straightforward, cost-free process that’s entirely online and based on self-declaration, removing the need for uploading physical documents. 

  1. Go to the Udyam website: Proceed to the official Udyam Registration portal first.
  2. Choose the type of registration: Select the option labelled ‘For New Entrepreneurs who are not yet Registered as MSME or those with EM-II’.
  3. Fill up your Aadhaar details: Give your Aadhaar number and confirm it using the one-time password that was issued to the mobile number you registered.
  4. Enter PAN Details: From 1st April 2021, PAN and GSTIN information is required. Hence, input your PAN details, select your type of business/organisation, and enter your business PAN. 
  5. Fill in additional information: Update other required details such as NIC number, mobile number, bank details, and turnover information.
  6. Receive final OTP: After entering all details, click to receive the final OTP and enter it along with the captcha to submit the form.
  7. Confirmation and URN: Upon submission, a pop-up will confirm the status, and you will receive a Udyam Registration Number (URN) and an e-certificate on your mobile/email.

You may also like: Financial Planning for Entrepreneurs

Advantages of Udyam Registration for MSME

  • Enterprises are assigned a unique identity number and permanent registration, which does not require renewal.
  • The Udayam certificate registration process is made simpler by being fully paperless and relying on self-declaration.
  • Allows for the listing of multiple operations under a single registration, including manufacturing, services, and both.
  • It makes it easier to register on major government websites, including TReDS platforms for receivables trading, SAMADHAAN for payment delays, and GeM (Government e-Marketplace) for business-to-government transactions.
  • Helps MSMEs take advantage of the different programmes that the Ministry of MSMEs offers.
  • Financial institutions can grant priority sector loans to MSMEs that have Udayam Registration.

How to print the Udyam Registration certificate?

Step 1: Go to the official Udyam Registration portal.

Step 2: Choose ‘Print Udyam Certificate’ after clicking on the ‘Print/Verify’ option.

Step 3: You must enter both your cell number and Udyam Registration Number. 

Step 4: Next, click “Validate & Generate OTP” after selecting the OTP option with the registered email or mobile number.

Step 5: Select ‘Validate OTP and Login’ after entering the OTP you received via email or your mobile.

Step 6: You can now print your Udyam Registration certificate after logging in.

Also read: Understanding blue chip stocks – Meaning, features and their safety


MSMEs can easily obtain government benefits through Udyam Registration, which is a hassle-free, fully online process. For small and medium-sized businesses looking to grow and survive in the competitive market, it’s a necessary first step because it opens doors to funding, subsidies, and business expansion prospects.

Enjoyed reading this? Share it with your friends.

StockGro Team

StockGro is India’s first and largest ‘Social Investment’ platform aimed at helping you master the art of “Trading & Investment”. Trade, Invest and get rewarded to Learn everything about ‘Investments’ the fun-filled way.

Post navigation

Leave a Comment

Leave a Reply

Your email address will not be published. Required fields are marked *