Simplifying Udyam and MSME Registration: A Step-by-Step Comparison

Udyam registration portal is a process introduced by the Indian government to register and classify micro, small, and medium enterprises (MSMEs) for various benefits and incentives. It replaced the earlier method of MSME registration in order to simplify and streamline the process for businesses seeking to avail themselves of the advantages offered to small enterprises. The term “Udyam” means enterprise in Hindi, reflecting the focus on promoting and supporting businesses in India.

The world of small businesses is fueled by innovation, resilience, and growth. To facilitate this growth, governments offer special registrations such as Udyam and MSME, providing businesses with a range of benefits and opportunities. In this article, we will walk you through a step-by-step comparison of the Udyam and MSME registration processes, helping you understand the pathways to unlocking support for your business.

Step-by-Step Comparison: Udyam and MSME Registration

Step 1: Eligibility Check:

Udyam: Determine if your enterprise qualifies as a micro, small, or medium enterprise based on your investment in plant and machinery or equipment.

MSME: Assess your business’s classification based on both investment and turnover criteria.

Step 2: Documentation:

Udyam: Gather necessary documents, such as Aadhaar card, PAN card, and business information.

MSME: Collect documents like business registration certificates, financial statements, and ownership details.


Step 3: Online Application:

Udyam: Visit the Udyam Registration portal and fill in the required details, including the Aadhaar number of the applicant.

MSME: Access the MSME registration portal and complete the application form with accurate business information.

Step 4: Verification:

Udyam: Verification of the details provided is done through the Aadhaar-based OTP authentication process.

MSME: Verification involves cross-checking the provided documents and information with the government’s database.

Step 5: Registration Certificate:

Udyam: Once verified, the Udyam Registration Certificate is issued, containing a unique Udyam Registration Number (URN).

MSME: On successful verification, an MSME Certificate is provided with a unique MSME Registration Number.

Step 6: Access to Benefits:

Udyam: The Udyam Registration Certificate grants access to various benefits, incentives, and schemes.

MSME: The MSME Certificate provides access to benefits, subsidies, and support as per the government’s policies.

Step 7: Benefits and Incentives:

Udyam: The Udyam registration offers benefits such as easier access to loans and credit, subsidies for technology upgradation, tax exemptions, and participation in government tenders. These benefits are tailored to the classification of micro, small, or medium enterprise.


MSME: MSME registration provides similar benefits, including financial support, tax benefits, and opportunities to participate in government procurement. The benefits may vary based on the business’s classification as micro, small, or medium.


Step 8: Renewal and Updates:

Udyam: Udyam registration does not require renewal, but it’s essential to keep your business information updated, especially if there are changes in investment or turnover.

MSME: The MSME registration is generally valid for a period of 5 years, after which it needs to be renewed. Any changes in business details should be updated during the renewal process.

Step 9: Impact on Growth:

Udyam: The simplified classification based on investment streamlines the process and makes it easier for businesses to understand their eligibility for benefits. This targeted approach helps businesses access appropriate support for their growth.

MSME: The dual criteria of investment and turnover under MSME registration offer a broader perspective, considering both financial aspects of the business. This can be advantageous for businesses where turnover is a significant factor in assessing their size.

You can also Apply for Print Udyog Aadhar Certificate 

Step 10: Decision-Making Factors:

Udyam: Opt for Udyam registration if your enterprise’s classification aligns well with the investment-based criteria and you seek specific benefits based on this classification.

MSME: Choose MSME registration if your business’s size is better defined by a combination of investment and turnover. This could be particularly relevant if your business’s turnover is significant in comparison to investment.


Navigating the intricacies of Udyam and MSME registration involves understanding the classification criteria, the registration process, and the subsequent benefits. While Udyam simplifies classification through investment-based criteria, MSME registration takes a more comprehensive approach, considering both investment and turnover. The decision between the two registrations should be guided by your business’s unique circumstances, growth aspirations, and the benefits that align with your needs.

Leave a Reply

Your email address will not be published. Required fields are marked *