How to Register Under MSME

Registering under the Micro, Small, and Medium Enterprises (MSME) scheme in India is a strategic move for any entrepreneur looking to establish credibility, access government benefits, and scale their business sustainably. The MSME sector contributes significantly to India’s GDP, employment generation, and industrial output, accounting for over 30% of the nation’s manufacturing output and nearly 45% of total exports. Despite this, millions of small business owners remain unregistered, missing out on critical financial incentives, tax reliefs, and market opportunities.

MSME registration is not a bureaucratic formality—it is a gateway to institutional support, easier credit access, subsidies on technology upgrades, and preferential treatment in public procurement. Whether you are a home-based artisan, a local manufacturer, a service provider, or a startup with a turnover under ₹250 crore, understanding how to register under MSME is essential for long-term growth.

This comprehensive guide walks you through every step of the registration process, from eligibility criteria to document preparation, online submission, and post-registration compliance. We also include best practices, essential tools, real-world examples, and answers to frequently asked questions—all designed to ensure you complete your MSME registration accurately, efficiently, and with full confidence.

Step-by-Step Guide

Understand MSME Classification Criteria

Before initiating registration, it is crucial to determine which category your enterprise falls under. The Government of India revised the MSME classification in 2020 under the Atmanirbhar Bharat Abhiyan, replacing the old investment-based criteria with a dual criterion of investment and annual turnover.

MSMEs are now categorized into three tiers:

• Micro Enterprise: Investment up to ₹1 crore and annual turnover up to ₹5 crore
• Small Enterprise: Investment up to ₹10 crore and annual turnover up to ₹50 crore
• Medium Enterprise: Investment up to ₹50 crore and annual turnover up to ₹250 crore

These categories apply to both manufacturing and service enterprises. For manufacturing units, investment refers to the plant and machinery (excluding land and buildings). For service enterprises, it refers to equipment used in providing services. Turnover is calculated based on the income declared in your Income Tax Return (ITR) or audited financial statements.

Ensure your business meets at least one of the two criteria (investment or turnover) to qualify. If your enterprise exceeds the upper limit for medium enterprises, you are no longer eligible for MSME registration.

Gather Required Documents

MSME registration is entirely online and paperless. However, having the right documents ready will expedite the process and prevent rejection. The following documents are typically required:

• Permanent Account Number (PAN) of the enterprise owner or authorized signatory
• Aadhaar Card of the proprietor, partner, or director
• Bank Account Details—account number and IFSC code of the business bank account
• Business Address Proof—electricity bill, rent agreement, or property tax receipt
• Details of Business Activity—description of goods manufactured or services provided
• Company Registration Documents (if applicable)—Certificate of Incorporation for Pvt. Ltd., LLP, or partnership firm
• Udyam Registration Number (URN) from previous registration (if any)—to link with the new portal

For partnership firms or companies, additional documents such as the partnership deed or MOA/AOA may be requested. Keep digital scanned copies (PDF or JPG) of all documents under 5MB each. Ensure the names on your Aadhaar, PAN, and business documents match exactly to avoid verification failures.

Visit the Official Udyam Registration Portal

The sole authorized platform for MSME registration is the Udyam Registration Portal, hosted by the Ministry of Micro, Small and Medium Enterprises (MSME). The portal URL is https://udyamregistration.gov.in.

Do not use third-party websites or agents claiming to register MSMEs for a fee. The registration process is free of cost, and any charge for assistance is unnecessary and potentially fraudulent. The portal is designed for self-service and works seamlessly on desktop and mobile browsers.

Create an Account on the Udyam Portal

On the homepage, click on the “New Udyam Registration” button. You will be prompted to enter your Aadhaar number. This is mandatory as the entire registration is Aadhaar-based and linked to the government’s digital identity system.

After entering your Aadhaar, click “Generate OTP.” You will receive a One-Time Password on your registered mobile number. Enter the OTP to proceed. If your Aadhaar is not linked to your mobile number, you must update it at the nearest Aadhaar center before continuing.

Once verified, you will be asked to create a password for your Udyam account. Use a strong password combining uppercase, lowercase, numbers, and special characters. This account will allow you to view your registration status, download certificates, and update information in the future.

Fill the Udyam Registration Form

The registration form is divided into multiple sections. Complete each section carefully:

1. Entrepreneur Details: Enter your full name as per Aadhaar, gender, category (SC/ST/OBC/General), and mobile number.
2. Enterprise Details: Provide the enterprise name, type (Proprietorship, Partnership, LLP, Company, etc.), and date of commencement of business.
3. Address Details: Enter the complete registered office address—state, district, pin code, and full postal address. Ensure this matches your business address proof.
4. Bank Details: Enter the name of the bank, branch, account number, and IFSC code. The account must be active and in the name of the enterprise or proprietor.
5. Business Activity: Select the primary activity from the dropdown—manufacturing or service. Then, specify the nature of goods or services. If your activity is not listed, choose “Other” and provide a brief description.
6. Investment and Turnover: Enter the latest investment in plant and machinery (for manufacturing) or equipment (for services). Then, provide the turnover for the previous financial year. If your business is new and has no turnover, select “Not Applicable.”
7. Other Details: Indicate whether you are registered under any other government scheme (e.g., Startup India, Udyog Aadhaar), and confirm that the information provided is true and accurate.

Double-check all entries before submission. Any mismatch in names, numbers, or categories may lead to delays or rejection. You can save the form as a draft and return later if needed.

Submit and Receive Udyam Registration Number (URN)

After reviewing your entries, click “Submit.” You will be redirected to a confirmation page. A unique Udyam Registration Number (URN) will be generated instantly. This number is your official MSME identity and will be sent to your registered mobile number and email.

The URN follows the format: Udyam-XX-XXXX-XXXX-XXXX. Keep this number safe—it will be required for availing subsidies, bidding for government tenders, and applying for loans.

You will also receive a digitally signed Udyam Certificate in PDF format via email. This certificate is legally valid and can be used for all official purposes. Download and save it in multiple locations. You can also access it anytime by logging into your Udyam account.

Update Information (If Required)

Businesses evolve. If your investment increases, turnover changes, or your address shifts, you must update your Udyam registration. Log in to the portal, navigate to “Edit Udyam Registration,” and modify the relevant fields. Changes are reviewed and updated within 2–3 working days.

It is mandatory to update your turnover annually. Failure to do so may result in your registration being marked inactive, which could disqualify you from future benefits.

Best Practices

Register Early, Even If Your Business Is Small

Many entrepreneurs delay registration, assuming it’s unnecessary until they scale. However, registering early gives you immediate access to credit facilities, training programs, and market linkages. Even if your turnover is below ₹5 lakh, you still qualify as a micro-enterprise. Early registration builds institutional trust and positions you as a compliant business owner.

Use a Dedicated Business Bank Account

Always use a separate bank account for your business transactions. This simplifies turnover calculation, ensures accurate record-keeping, and avoids confusion during audits. Banks also prefer businesses with dedicated accounts when processing MSME-linked loans or overdraft facilities.

Keep Digital Records of All Transactions

For accurate turnover reporting, maintain digital records of all sales, purchases, and expenses. Use free accounting tools like Tally.ERP 9 (free version), Zoho Books, or Google Sheets to log daily transactions. This will make annual updates to your Udyam profile seamless and error-free.

Link Udyam with GST and PAN

Ensure your Udyam registration is linked to your GSTIN and PAN. While not mandatory at the time of registration, integration improves visibility in government databases and increases your eligibility for schemes like the Emergency Credit Line Guarantee Scheme (ECLGS) or interest subvention programs.

Regularly Monitor Updates from MSME Ministry

MSME policies and benefits evolve frequently. Subscribe to the official MSME newsletter or follow the ministry’s social media channels to stay informed about new schemes, subsidy deadlines, and eligibility changes. For example, recent initiatives include interest-free loans for women entrepreneurs and digital literacy grants for rural MSMEs.

Do Not Rely on Third-Party Agents

Some agencies charge ₹1,000–₹5,000 to “assist” with MSME registration. This is unnecessary. The entire process takes less than 15 minutes if you have your documents ready. Always use the official portal. If you encounter technical issues, use the “Help” section on the Udyam website or contact the government’s technical support via the portal’s contact form.

Apply for Additional Certifications Alongside

While MSME registration is foundational, consider combining it with other certifications to enhance credibility:

• ISO Certification for quality management
• Trademark Registration for brand protection
• Startup India Recognition if you are under 10 years old and innovating
• Women Entrepreneurship Platform (WEP) Registration for female founders

These certifications, when paired with MSME registration, create a strong compliance profile that attracts investors and buyers.

Tools and Resources

Official MSME Portal

The Udyam Registration Portal is the only official platform for registration. It offers a user-friendly interface, multilingual support (including Hindi, Tamil, Telugu, and Bengali), and real-time status tracking.

MSME Samadhaan Portal

Once registered, use the MSME Samadhaan Portal to file complaints against delayed payments by buyers (especially government departments and PSUs). Under Section 15 of the MSMED Act, 2006, buyers must pay within 45 days. If they default, the MSME can seek interest at three times the bank rate through this portal.

Udyam Assist App

Download the official Udyam Assist mobile app (available on Android and iOS). It allows you to:

• Check registration status
• Download your certificate
• Update enterprise details
• Access scheme alerts

The app is lightweight, secure, and designed for users with limited internet connectivity.

MSME Credit Guarantee Fund Trust (CGFT)

Registered MSMEs can access collateral-free loans up to ₹5 crore through the Credit Guarantee Fund Trust. Visit https://www.cgftrust.in to understand eligibility and apply through partner banks like SBI, HDFC, or ICICI.

MSME Databank

The MSME Databank (https://msmedatabank.gov.in) is a searchable repository of registered MSMEs. It helps buyers and suppliers find vendors and facilitates B2B networking. Ensure your enterprise is listed and updated for visibility.

Government Schemes Directory

Use the MSME Ministry Website to explore over 100 schemes, including:

• Prime Minister’s Employment Generation Programme (PMEGP)
• Technology and Quality Upgradation Support (TEQUP)
• Subsidy on Patent Filing
• Interest Subvention on Working Capital Loans
• Market Access Initiatives (MAI)

Each scheme has eligibility criteria, application deadlines, and required documentation clearly listed.

Free Online Accounting Tools

Manage your finances without cost:

• Zoho Books – Free plan for small businesses
• Wave Accounting – Unlimited invoices and bank reconciliation
• Google Sheets + MSME Template – Download free MSME turnover tracker from MSME portal

Legal and Compliance Resources

For legal clarity, refer to:

• Micro, Small and Medium Enterprises Development Act, 2006 – The foundational law
• MSME Guidelines, 2020 – Updated classification norms
• Udyam Registration Rules, 2020 – Procedural guidelines

All documents are available for free download on the MSME Ministry website.

Real Examples

Example 1: Artisan from Rajasthan – Handmade Pottery Business

Meera, a third-generation potter from Jaipur, runs a small workshop producing handcrafted clay utensils. She employs two local artisans and earns ₹3.8 lakh annually. She had never registered her business, assuming it was too small.

After learning about MSME benefits from a district-level entrepreneurship workshop, she registered online using her Aadhaar and PAN. Her investment in kilns and tools was ₹75,000, placing her under the micro-enterprise category.

Within a month, she received:

• 50% subsidy on a new electric kiln under TEQUP scheme
• Access to a government-run e-marketplace to sell her products nationally
• Lower interest rate (7.5%) on a ₹2 lakh loan from a local cooperative bank

Her turnover increased by 40% in six months due to increased visibility and reduced input costs.

Example 2: Tech Startup in Bengaluru – Software Services

A startup founded by two engineers offered SaaS solutions to small retailers. Their annual turnover was ₹42 crore, and they had invested ₹8.5 crore in software licenses and servers. They registered as a medium enterprise under MSME.

Benefits received:

• Eligibility to bid for government IT tenders reserved for MSMEs
• Exemption from stamp duty on property lease for their office
• Priority in the National Startup Awards and incubation support
• Access to export promotion schemes under the Foreign Trade Policy

They secured a ₹1.2 crore contract with a state transport corporation, which required MSME certification as a mandatory criterion.

Example 3: Women-Owned Tailoring Unit in Odisha

Sunita runs a tailoring unit in Cuttack with five employees. Her annual turnover is ₹18 lakh, and her equipment investment is ₹4.2 lakh. She registered as a micro-enterprise and applied for the Women Entrepreneurship Platform (WEP) registration.

She received:

• ₹50,000 grant for upgrading sewing machines
• Free training in digital marketing through the MSME portal
• Listing on the Government e-Marketplace (GeM) portal, leading to bulk orders from schools and hospitals

Her business now employs 12 women and exports hand-stitched garments to neighboring states.

Example 4: Food Processing Unit in Punjab – Organic Pickles

A family-run unit producing organic mango and lime pickles had a turnover of ₹6.5 crore and an investment of ₹12 crore in processing equipment. They registered as a small enterprise.

They leveraged MSME registration to:

• Apply for FSSAI license under the government’s simplified food safety norms for MSMEs
• Get 35% subsidy on cold storage setup
• Participate in international food fairs funded by the Ministry of Food Processing Industries

They now export to the UAE and Singapore under the “Make in India” initiative.

FAQs

Is MSME registration mandatory?

No, MSME registration is not mandatory by law. However, it is highly recommended because without it, you cannot access government subsidies, credit guarantees, tax benefits, or preferential treatment in public procurement.

Can I register if I have no formal business structure?

Yes. Sole proprietors, home-based workers, artisans, and freelancers can register under MSME. You do not need a company registration or GSTIN to apply.

What if my turnover exceeds the limit after registration?

If your turnover crosses the upper limit for your category (e.g., from micro to small), you must update your profile on the Udyam portal. Your registration remains valid, but you will no longer be eligible for benefits reserved for micro or small enterprises.

Can a partnership firm register under MSME?

Yes. Partnership firms, LLPs, private limited companies, and cooperative societies are all eligible. You will need to provide the partnership deed or incorporation certificate during registration.

Is there a renewal process for MSME registration?

No, MSME registration is valid for life. However, you must update your turnover details annually. Failure to do so may lead to deactivation of your profile.

Can I register multiple businesses under one Udyam number?

No. Each business entity must have a separate Udyam Registration Number. If you own two different enterprises (e.g., a bakery and a catering service), you must register them separately.

Does MSME registration give me GST exemption?

No. MSME registration does not automatically exempt you from GST. However, micro-enterprises with turnover below ₹40 lakh (₹20 lakh for special category states) are exempt from GST registration. MSME status helps you qualify for other indirect benefits like interest subvention and easier compliance.

How long does it take to get the certificate?

Udyam registration is instant. You receive your Udyam Registration Number and certificate within minutes of successful submission. There is no waiting period or physical verification.

Can I apply for MSME registration if I am not an Indian citizen?

Only Indian citizens or entities incorporated under Indian law can register. NRIs and foreign nationals cannot register unless they have established a legal entity in India with Indian ownership.

What happens if I provide incorrect information?

Providing false information may lead to cancellation of your registration and disqualification from future schemes. The government cross-verifies data with Aadhaar, GST, and income tax databases. Always ensure accuracy.

Conclusion

Registering under MSME is one of the most impactful decisions a small business owner in India can make. It transforms an informal enterprise into a recognized, supported, and scalable entity. The process is simple, free, and entirely digital—requiring no intermediaries, no fees, and no delays.

From artisans in rural villages to tech startups in metro cities, MSME registration unlocks doors to funding, markets, and mentorship that were previously out of reach. It is not merely about compliance—it is about empowerment.

By following the steps outlined in this guide, you have taken the first step toward formalizing your business, protecting your rights, and accessing the full ecosystem of government support. Remember: registration is not a one-time task. Stay updated, maintain accurate records, and leverage every benefit available to you.

As India continues to prioritize self-reliance and grassroots entrepreneurship, your MSME registration becomes more than a certificate—it becomes a symbol of your contribution to the nation’s economic resilience. Register today, and build a future that is not just profitable, but also protected, recognized, and sustainable.