India is an agro-based economy where nearly two-thirds of the population is considered to be rural. Micro, Small, and Medium Enterprises, also abbreviated as MSMEs, play a really important role in developing the country’s economy by reducing regional imbalances. MSMEs account for 45% of India’s total employment, 50% of national exports, and 95% of total national industries. The Government of India set up the Ministry of Micro, Small, and Medium Enterprises in 1999 to make and execute laws regarding the rural sector industries.
The Udyog Aadhar and Udyam registration offered at the MSME registration online portal is an initiative for small-scale industries to get registered as MSMEs under the government to get all the government subsidies meant for them quickly.
If you’ve heard about this registration but don’t know what exactly it is exactly? then keep reading this article. In this article, we’ve covered everything about Udyog Aadhaar and Udhyam Registration. Let’s begin!
What do you mean by Udyam Registration and Udyog Aadhar?
The MSME registration procedure was renamed Udyog Aadhaar in September 2015. Under Aadhar Udyog registration, the Ministry of MSME issues a twelve-digit Unique Identification number for all small and medium enterprises. But despite having innumerable government incentives, it was observed that most small sector businesses remained unregistered due to heavy paperwork (that created a lot of confusion and a lengthy registration process.
On 1 July 2020, the Indian government introduced a new scheme known as the Udyam Registration as a replacement for the earlier process of Udyog Aadhar registration. From now on, the MSMEs are called Udyam.
The MSME registration online process has made the MSME registration online process a cakewalk for any ordinary citizen of our country. The process of your business through the MSME registration online portal was a very hectic task. It included a lot of documents, formalities, and paperwork and was indeed a time-consuming process. It left the business people perplexed and made them wonder whether it was better not to register under the scheme.
But the Udyam Registration is a paperless process where small firms can undergo MSME registration online by only filling a single page form sitting in the comfort of their home or by visiting Aadhar offices. You only need your Aadhar Card, and you are done. Submission of the form is dependent totally on self-declaration making the whole process faster and smoother.
As per the new notification from the government, those who were already registered under the MSME Development Act, 2006 will now have to re-register on Udyam for optimum utilization of government benefits.So, Udyam registration is the new name of Udyog Aadhaar, i.e., both of these are the same thing.
What are the benefits of Udyam registration?
The benefits of the Udyam registration Scheme are as follows:
Businesses can gain advantage from pre-existing as well as new government Schemes.
The MSMEs can get free or 100% subsidized bank loans without submitting a collateral mortgage.
Small firms are protected against delayed and default payment of loans back to the bank.
Payments are made by ISO (International Organization for Standardization) Certified payment modes, thereby ensuring cent per cent security of the payments.
Concession on electricity and water bills is given to the business infrastructures like shops, factories, offices, etc.
MSMEs get subsidies on many government-related and other expenditures like registration of barcodes, GST returns, bank loans, income tax, licensing, etc.
Special preference in obtaining government tenders.
- 1% interest rate discount on bank overdrafts.
- Fast dispute resolution.
- 50% discount on government trademark
- 50% discount on patent fees.
- The business proprietor will get protection from postponement.
- Free insurance credits from the banks.
- Business holders can get NSIC sponsorships and are qualified for IPS appropriations.
- Entrepreneurs will be guaranteed stamp obligations and enlistment expenses.
- Small businesses will benefit from Octroi's motivations.
- Reservation by SSI and MSME for selective re-assembling of items.
- Businesses can excise exclusion plots.
- Interested entrepreneurs can become a part of worldwide business fairs.
- MSME Udyog registration online portal for registration under Udyam Registration has become simple.
Difference between Udyog Aadhar and Udyam Registration
Under the Udyam scheme, MSMEs can be classified into the following three broad categories-
The difference between both the schemes are:
Udyog Aadhaar requires the applicant's Aadhar card and PAN, whereas Udyam registration only requires the participant's Aadhar card and gives verified certification as per new MSME rules.
Udyog Aadhaar is not linked with any other government portal, but Udyam registration is fully integrated with government portals like Gem.
Businesses can apply for Udyog Aadhaar without the Aadhar mobile link facility, but Udyam registration only needs an Aadhar card linked to a mobile number.
Udyam registration allows one person with an Aadhaar card to register for only one firm in his name. However, Udyog Aadhaar allowed multiple firms to register with one Aadhaar only.
On approval from the government, the Udyam certificate will be generated and sent to the enlisted email id. This certificate will contain a unique permanent identification number known as the Udyam Registration Number (URN), which is of great use.
The application form of Udyog Aadhaar is smaller and shorter than the application form of Udyam Registration which asks for crucial information like GST, Income Tax, etc.
The earlier process of Udyog Aadhaar was confusing, which led to many errors and, finally, frequent rejection of the certificates. However, the new method of Udyam Registration is very efficient and minimizes the chances of mistakes.
Conclusion
The MSMEs are the backbone of the rural Indian economy. Hence, the government is trying its best to ensure these industries' optimum growth and development by initiating advanced schemes. The conversion of Udyog registration into Udyam Registration is a vital example of such a scheme. Despite all these, it is our responsibility as citizens to provide the government with correct details to the best of our knowledge. If you’re planning to do the Udyam registration or Udyog registration, then you need a professional business consultant firm like Lawgical India that can help you to do registration more easily. Contact Us today to complete your registration with experts.
