ngIf you are planning to start a business in India, one of the most crucial things that you need to do is obtain the Udyam registration or license. The Udyam registration is a new initiative by the Indian government to provide an easy and single-window registration process to small and medium-sized businesses. In this article, we will guide you through the process of obtaining the Udyam license for your business.
Are you looking to loan your existing business in India or are you are starting a small enterprise? If yes, then you must be aware of the Udyam Registration, formerly known as Udyog Aadhaar Registration, introduced by the Ministry of Micro, Small and Medium Enterprises (MSME) in July 2020. The Udyam License aims to facilitate the growth and development of small businesses in India and provide them with various benefits. In this article, we will discuss how to obtain the Udyam License and its benefits for your business.
What is the Udyam License?
The Udyam License is a unique 12-digit identification number provided to small businesses in India by the MSME. The Udyam License is an online registration process that replaced the Udyog Aadhaar Registration process in July 2020. The registration is mandatory for businesses with an investment of up to Rs. 50 crores and an annual turnover of up to Rs. 250 crores. The Udyam License provides various benefits to small businesses, such as easy access to loans, subsidies, and other government schemes.
What is the Udyam Registration?
The Udyam registration or license is a unique identification number that is provided to small and medium-sized businesses in India. It is issued by the Ministry of Micro, Small and Medium Enterprises (MSME) under the Government of India. The Udyam registration is aimed at simplifying the registration process and providing a single-window for all registrations related to MSMEs.
Both udyam registration and udyam license are both same.
Steps to Obtain the Udyam Registration or License
Obtaining the Udyam registration or license is a simple and hassle-free process. Here are the steps that you need to follow to obtain the Udyam registration or license for your business:
Step 1: Visit the Udyam Registration Portal
The first step is to visit the official Udyam registration portal. On the homepage, click on the “For New Entrepreneurs who are not Registered yet as MSME” tab.
Step 2: Enter Your Aadhaar Number
Next, enter your 12-digit Aadhaar number and click on “Validate & Generate OTP.” An OTP will be sent to your registered mobile number.
Step 3: Enter OTP and Business Details
Enter the OTP received on your mobile number and click on “Validate OTP.” Next, fill in the required details such as the name of your business, PAN number, address, and other details.
Step 4: Complete the Declaration
Read the declaration carefully and tick the checkbox to confirm that the details provided by you are true and correct to the best of your knowledge. Next, click on the “Submit” button.
Step 5: Make Payment
Make the payment for the Udyam License registration. The registration fee is Rs. 1,000 for general category businesses and Rs. 500 for SC/ST/Women-owned businesses.
Step 6: Obtain Udyam Registration or License
On successful submission of your application, you will receive your Udyam registration or license number. You can download the registration certificate and keep it for future reference.
Benefits of the Udyam License
Obtaining the Udyam registration or license comes with several benefits for small and medium-sized businesses in India. Some of these benefits are:
Access to Credit and Loans
Small businesses registered under the Udyam License are eligible for various government schemes such as the Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGS), which provides collateral-free loans up to Rs. 2 crores.
Subsidies and Grants
Small businesses registered under the Udyam License are eligible for various subsidies and grants provided by the government for the development of small businesses.
Protection of Intellectual Property
Small businesses registered under the Udyam License can avail of the benefits of the Intellectual Property Rights (IPR) scheme of the government. The scheme helps in the registration of trademarks, patents, and designs.
Exemption from Direct Tax Laws
Small businesses registered under the Udyam License are exempted from the payment of direct tax laws such as Minimum Alternate Tax (MAT).
Concessions on Electricity Bills
Small businesses registered under the Udyam License are eligible for concessions on their electricity bills.
Access to Government Tenders
Small businesses registered under the Udyam License can participate in government tenders exclusively reserved for small businesses.
Frequently Asked Questions (FAQs)
Q1. Who can apply for the Udyam License?
Ans. Any business entity that falls under the definition of a micro, small or medium enterprise can apply for the Udhyam License. The classification of a business as micro, small, or medium depends on the investment made in plant and machinery or equipment, as well as the annual turnover of the business.
In case of a proprietorship firm, the proprietor should possess a valid Aadhaar number.
In the matter of a partnership firm, all partners should have a valid Aadhaar number.
Regarding of a company or a limited liability partnership (LLP), the directors or designated partners should have a valid Aadhaar number.
Q2. Is the Udyam License registration a one-time process?
Ans. Yes, the Udhyam License registration is a one-time process. Once a business obtains the Udyam License, it does not need to renew or update its registration, unless there are any changes to the information provided during the registration process. However, businesses are required to update their information on the Udyam Registration portal in case of any changes such as turnover, investment, or other relevant details.
Q3. What are the documents required for Udyam License registration?
Ans. The documents required for Udhyam License registration include the following:
- Aadhaar card of the proprietor, partner, or director, as applicable
- PAN card of the business entity
- GSTIN (Goods and Services Tax Identification Number) of the business, if applicable
- Bank account details of the business
- Information about the type of business entity (proprietorship, partnership, company, LLP, etc.)
- Details of the business activities and the products/services offered
- Plant and machinery or equipment details and investment made in them
- Annual turnover of the business.
In addition to these documents, any other relevant documents related to the business may also be required for Udyam License registration.
Q4. What is the fee for Udyam License registration?
Ans. The registration fee for the Udhyam License is Rs. 1,399 for general category businesses and Rs. 500 for SC/ST/Women-owned businesses.
Q5. Can a business change its Udyam License registration details?
Ans. Yes, a business can change its Udhyam License registration details in case there are any changes to the information provided during the registration process. For instance, if there is a change in the turnover of the business, or if the business invests in additional plant and machinery or equipment, the business is required to update the registration details on the Udyam Registration portal. The updated information will be reflected in the Udyam Certificate that is issued to the business.
It is important for businesses to keep their registration details up-to-date as the benefits and incentives provided under various government schemes may depend on the turnover and investment made by the business, and any incorrect or outdated information may lead to the business missing out on these benefits.
Q6. What is the validity of the Udyam License?
Ans. The Udhyam License is valid for a lifetime and does not require any renewal. The Udhyam License does not have a specific validity period. Once a business obtains the Udhyam License, it is valid for as long as the business continues to operate. The license does not need to be renewed or updated unless there are any changes to the information provided during the registration process.
Q7. How to print and download udyam license online?
Ans. Once a business completes its Udhyam License registration process on the Udhyam Registration portal. It can download and print its Udyam Certificate by following these steps:
- Visit the Udyam Registration portal to print and download udyam certificate.
- Click on the “Print Udyam Certificate” option in the main menu.
- Enter the Udyam Registration Number (URN) that was generated during the registration process, and the registered mobile number or email address.
- Click on the “Validate and Generate” button.
- Once the details are validated, the Udyam Certificate will be displayed on the screen.
- Click on the “Download Certificate” button to download a soft copy of the certificate.
- Click on the “Print Certificate” button to take a printout of the certificate.
It is recommended that businesses keep a copy of the Udyam Certificate in both digital and physical formats for future reference.
The Udyam License is a unique identification number provided to small businesses in India by the Ministry of Micro, Small, and Medium Enterprises. The registration process is simple and easy, and small businesses can avail various benefits such as easy access to loans, subsidies, and other government schemes. The Udhyam License also provides protection for intellectual property and concessions on electricity bills. If you own a small business or plan to start one, obtaining the Udhyam License is essential to avail the benefits provided by the government for the growth and development of small businesses in India.
In conclusion, obtaining the Udhyam registration or license is a crucial step for small and medium-sized businesses in India. It provides various benefits and simplifies the registration process. Follow the steps mentioned above to obtain your Udhyam registration or license hassle-free.