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Micro, Small and Medium Enterprises

What Is MSME and Udyog Aadhaar

What is MSME ? 

MSME stands for Micro, Small and Medium Enterprises. In a developing country like India, MSME  industries are the backbone of the economy.

Micro, Small and Medium Enterprises
Micro, Small and Medium Enterprises
Micro-Small & Medium Enterprises (MSMEs) contribute largely in the socio-economic development of our country. MSMEs come under the Ministry of Micro, Small & Medium Enterprises and are required to be registered to avail benefits under the Micro, Small and Medium Enterprises Development (MSMED) Act. MSME registration is highly important, as it enables these enterprises in availing benefits from various government initiated schemes. MSMEs are classified in two categories, such as manufacturing and service enterprises.

The MSME sector contributes to 45% of India’s Total Industrial Employment, 50% of India’s Total Exports and 95% of all industrial units of the country and more than 6000 types of products are manufactured in these industries (As per When these industries grow, the economy of the country grows as a whole and flourishes. These industries are also known as small-scale industries or SSI’s.

What is Udyog Aadhaar ?
Udyog Aadhaar is unique 12-digit Government identification number provided by the Ministry of MSME for the small and medium enterprises to register themselves as MSME.  

MSME updated to Udyog Aadhar

MSME registration has been replaced with the Udyog Aadhar registration. If any micro, small and medium industries want to start any business; they need to do the registration with MSME/Udyog Aadhar.

This registration with MSME/Udyog Aadhar can be done in two ways online and offline. This facility provides the business with a lot of benefits and subsidies.

Validity of the certificate

There is no expiry of the Udyog Aadhar Certificate. As long as the entity is ethical and financially healthy there will be no expiry of the certificate.

Existing And Revised Definition of MSMEs
New Definition of MSMEs
  • Low threshold in MSME definition have created a fear among MSMEs of graduating out of the benefits and hence killing the urge to grow. 
  • There has been a long-pending demand for revisions. 
      • Definition of MSMEs will be revised  
      • Investment limit will be revised upwards 
      • Additional criteria of turnover also being introduced.  
      • Distinction between manufacturing and service sector to be eliminated. 
      • Necessary amendments to law will be brought about.


Updated Definition of MSMEs _1st June 2020

Government Further Change the definition of MSMEs

The Cabinet approved the new definition of the MSME units as proposed by the finance ministry. Micro enterprises can now invest up to Rs 1 crore and have a turn over of Rs 5 crore.
Separately, for the small enterprises, the limit for investment has been raised to Rs 10 crore along with a turn over limit of Rs 50 crore. For medium enterprises, the investment limit has been raised to Rs 20 crore and the turnover limit has been raised to Rs 250 crore (from Rs 100 crore as announced earlier).
MSME are classified into two categories:
1. Manufacturing enterprise; and
2. Service enterprise.

They are defined in term of investment in Plant and Machinery/ Equipment  as below

MSME Clasification
MSME Clasification

 Benefits of MSME Registration

Benefits of MSMEs Registration In India
Benefits of MSMEs Registration In India
What are the activities specifically excluded from coverage under MSME?
Ministry of Micro, Small and Medium Enterprises (MSME) has clarified as per notification S.O 2576 (E) dated 18.09.2015 and subsequent notification no S.O 85(E) dated 10.1.2017, activities that would be specifically not included in the manufacturing or production of commodities or rendering of services as per Section 7 of the said Act.
  1. Forest and Logging
  2. Fishing and aquaculture
  3. Wholesale, retail trade and repair of motor vehicle and motorcycles
  4. Wholesale trade except for motor vehicles and motorcycles.
  5. Retail Trade Except of Motor Vehicles and motor cycles
  6. Activities of households as employees for domestic personnel
  7. Undifferentiated goods and services producing activities of private households for own
  8. Activities of extraterritorial organisations and bodies

How To Apply Udyog Aadhaar (MSME) Registration :- 

The registration process for obtaining a Udyog Aadhaar is fairly simple. For the registration you do not need to get the form attested by any professional. Also, the Government does not charge any registration fees for it. 
You just need to follow the given below steps and you can even do it yourself.
Step 1: Visit the site- Udyog Aadhaar(official website)
Step 2: Enter your Individual Aadhaar number . In case of partnership, the Partner applying Udyog                 Aadhaar shall give his Aadhaar number and in case of company, the Authorized signatory                   who is applying on behalf of the company shall give his Aadhaar number.
 Step 3: Enter the OTP received on the number linked with Aadhaar Card.
 Step 4: Fill out the Udyog Aadhaar Form, 
  • Aadhaar Number
  • Name of Owner  
  • Social Category – Applicant’s Caste
  • Name of Enterprise– Name of the legal entity to conduct business. One applicant can have more than one enterprises doing business and each one can be registered for a separate Udyog Aadhaar and with the same Aadhaar Number.
  • Type of Organization– Type of Business entity or Legal Entity. 
              1. Proprietorship 
              2. Partnership Firm 
              3. Hindu Undivided Family 
              4. Private Limited Company 
              5. Co-Operative 
              6. Public Limited Company  
              7. Self Help Group 
              8. Others (Limited Liability Partnership)
  • PAN Number- Mandatory for LLP, Company and Co-operative Society. Optional for the rest. 
  • Location of Plant 
  • Official Address– Address of the business including mobile and email address. 
  • Date of Commencement– The date on which businesses was started.
  • Previous Registration Details– Details of previous MSME/SSI registration, if applicable should be entered here.
  • Bank Details– Details of bank account of the company including IFSC Code and Bank Account number.
  • Major Activity– Major area of activity of the business – manufacturing or service. 
  • NIC Code– The appropriate NIC Code should be entered from the National Industrial Classification (NIC) handbook.
  • Person employed– The total number of people employed in the business. 
  • Investment in Plant & Machinery / Equipment– Amount of money invested in terms of machinery and equipment by the business. 
  • Details of the District Industry Center nearest to the business 

Step 5: Once you have filled out all the details, click on submit.
Step 6: Enter the OTP received on the number linked with Aadhaar.
Step 7: Enter the code on the screen for final submission.

How To Edit or update Udyog Aadhaar Number
In case, you need to update the details of your existing Udyog Aadhaar number, please follow the below given instructions: 
Step 1: Visit the site- Udyog Aadhaar(official website)
Step 2: Enter your Udyog Aadhaar Number. 
Step 3: Enter the verification code and submit. 
Step 4: Enter the OTP received on your Aadhaar linked number. 
Step 5: Edit the details you want to change and submit.

MSME- Udyog Aadhar



Contact For Udyog Aadhar (MSME) Registration

Dheeraj Kumar Singh

Mobile No. :- 7000980451

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1 year ago

Complete 👌

1 year ago

Very well explained