No, Udyog Aadhaar and MSME Registration are not the same. Udyog Aadhaar (New Business ID) is a document issued by the Ministry of Micro, Small and Medium Enterprises (MSME) that acts as an identity for micro businesses. It helps them get access to government schemes, bank loans, and certification services. MSME registration is a mandatory process for all small enterprises (with annual turnover of 20Cr or 20 million INR) operating in India which enables them to avail benefits and concessions under various Government of India schemes. Read on to know more about the differences between Udyog Aadhar and MSME Registration:
What is Udyog Aadhar?
Udyog Aadhar is a government initiative to ease the process of business registration for micro traders. It replaces the earlier format of Business Registration (BR) that was used for registering a business in India. Udyog Aadhar is mandatory for businesses with a turnover of 20 lakhs or less. Businesses with more than 20 lakhs turnover are required to register under the more detailed MSME (Micro, Small and Medium Enterprises) Registration. The Udyog Aadhar document replaces the earlier BR document and has an validity of 2 years. It is free and can be obtained from the respective State Industries Department.
MSME Registration in India
MSME Registration is the process through which one can start their own business or register under an existing business. It is a registration process followed by the Government of India to regulate and encourage businesses. MSME registration is also referred to as a Particulars of Business (POBO). MSME Registration requires businesses to specify their: Businesses with a turnover of less than 20 Cr (20 Million INR) are considered as MSMEs and are exempted from MSME registration. They may still avail benefits by submitting the Udyog Aadhar document. MSME registration has been revamped by the Government of India. It is now known as Udyog Aadhaar. The following are the benefits of Udyog Aadhaar/MSME Registration:
How to register for Udyog Aadhar?
Businesses may register for Udyog Aadhar by submitting an application to the concerned State Government. The State Government may charge a nominal fee for obtaining the Udyog Aadhar document. The Udyog Aadhar application may contain the following details: After submitting the application, the State Government may take a few days to process it. Once the Udyog Aadhar document is issued, it may be submitted to the concerned Government departments to avail benefits and concessions.
Difference between Udyog Aadhar and MSME Registration
The following are the key differences between Udyog Aadhar and MSME Registration: Udyog Aadhar is a document issued by the Government of India that simplifies the business registration process. It acts as an identity for micro businesses and replaces the earlier Business Registration (BR) format. MSME Registration is a mandatory process for all small businesses operating in India. It enables businesses to avail benefits and concessions under various Government of India schemes. MSME registration is a more detailed process compared to Udyog Aadhar. It requires businesses to specify more information about their operations and is valid for 3 years. MSME registration is more suitable for businesses with a turnover exceeding 20 lakhs.
Conclusion
Udyog Aadhar is a simplified version of Business Registration used for registering micro business in India. It is obtained by submitting an application to the State Government and acts as an identity for businesses with turnover of 20 lakhs or less. MSME registration is a more detailed process followed by the Government of India to regulate and encourage small businesses. It enables businesses to avail benefits and concessions under various Government of India schemes. With the benefits of simplified business registration, businesses can now focus more on their core activities and growth.