Starting a Micro, Small, and Medium Enterprise (MSME) in India requires multiple government registrations, one of which is Udyam. By registering your new business with Udyam, previously known as the Pradhan Mantri Udyog Yojana, you can legitimize it and avail of many facilities.
Benefits of Udyam
Here are a few advantages of registering your MSME with Udyam.
- Business capital
Starting a small business in India is challenging due to the lack of available funding. While getting an SME loan can help you with business capital, new companies often find it hard to get approval for funding. To solve this issue, the government has made it easier for Udyam-registered businesses to get loans from private and public financial institutions.
- Collateral-free financing
If your business has an Udyam registration, you can get a collateral-free loan based on your SME loan credit eligibility criteria, which include educational qualification, business type, and industry.
- Affordable loans
The payable interest for a business loan under Udyam Registration is around 1.5% lower than regular loans. With access to reasonable SME loan interest rates, Udyam helps you in starting the business.
- Vast network of lenders
You can get business loans for your Udyam-registered SME from a large network of lenders, including banks, Micro Units Development and Refinance Agency (MUDRA), non-banking financial institutions, Small Industries Development Bank of India (SIDBI), and more.
Document requirements for Udyam registration
- Address proof, name, e-mail, and phone number of the founder
- Aadhaar details
- Caste-related information: SC, ST, OBC, or General
- Constitution or the category of the SME: Proprietorship, Private Limited Company, or any other type
- Proof of name and address of the SME
- Bank details
- Date of business commencement
- Information about any earlier MSME registration
- District Industry Center (DIC) details
- Number of employees
- Total business investment
- National Industrial Classification (NIC) Code
Steps to apply for online Udyam registration
- Visit the Udyam Registration portal and provide your name along with your Aadhaar card number
- Generate OTP and validate it on the portal
- Fill the registration form by providing business and NIC details
- Fill separate forms for multiple industries if you are registering for more than one sector
- Self-certify the bank details, tenure of the SME, and information related to employment and ownership
- Click the ‘Submit’ button to generate another OTP
- Enter the new OTP and click on ‘Submit’ again
When the government accepts your application, you will receive the Udyam Registration Certificate by e-mail.
Registering your SME with Udyam will enable you to get business loans from a trustworthy lender. For example, Mahindra Finance offers flexible loans to SMEs. You can visit their website to check the SME loan documents required for the application.