Udyam Registration in India: MSME Classification, Benefits and How to Apply

Udyam registration is how a business gets recognised as a micro, small or medium enterprise. It's free, online, and unlocks a range of benefits. This guide explains how it works.

The Classification (From April 2025)

A business is classified on both investment in plant and machinery or equipment, and turnover. Both must be within the limit:

• Micro: investment up to ₹2.5 crore and turnover up to ₹10 crore.
• Small: investment up to ₹25 crore and turnover up to ₹100 crore.
• Medium: investment up to ₹125 crore and turnover up to ₹500 crore.

These limits were raised from April 2025, so many businesses now fall into a lower category, or qualify for the first time.

How Figures Are Taken

Investment and turnover are drawn from income-tax and GST data linked to the business's PAN. Export turnover is excluded from the turnover calculation.

How to Apply

1. Go to the official Udyam registration portal.
2. Verify the Aadhaar of the proprietor, managing partner, or authorised signatory.
3. Enter PAN and GSTIN, which are validated.
4. Enter business details, activities, locations and employees.
5. Submit to receive the Udyam Registration Number and e-certificate.

There's no fee. Be wary of websites that look official and charge for registration.

Benefits

• Protection on delayed payments for micro and small enterprises, including interest on late payment.
• Access to the state's MSE Facilitation Council for payment disputes.
• Priority sector lending and collateral-free credit schemes.
• Preferences in government procurement.
• Eligibility for many state and central schemes.

Keeping It Current

Classification is updated from tax data. Update the registration if activities, locations or other details change.

Getting Help

Think Filing registers businesses on Udyam, confirms their classification, and helps them use the benefits.