Udyam registration is the government's record of micro, small and medium enterprises. It gives your business a permanent Udyam Registration Number and a certificate that states your category. Banks, government buyers and many large companies ask for it, and it is the key to the protections the MSMED Act, 2006 gives smaller suppliers.
01The limits from 1 April 2025
The Ministry of MSME revised the limits by notification S.O. 1364(E) of 21 March 2025, in force from 1 April 2025:
| Category | Investment in plant, machinery or equipment | Turnover |
|---|---|---|
| Micro | Up to ₹2.5 crore | Up to ₹10 crore |
| Small | Up to ₹25 crore | Up to ₹100 crore |
| Medium | Up to ₹125 crore | Up to ₹500 crore |
Both tests apply together. If a business crosses either limit for its category, it moves to the next category.
How the figures are counted
- Investment is the value of plant, machinery or equipment, taken from your income tax return. Land, buildings and furniture are left out.
- Turnover is taken from your income tax and GST records, with exports excluded.
- Figures are linked to PAN, so all units and GSTINs on one PAN count together.
Examples
| Business | Plant and machinery | Turnover | Of which exports | Category |
|---|---|---|---|---|
| A Ludhiana hosiery maker | ₹1.8 crore | ₹14 crore | ₹5 crore | Micro. Turnover for Udyam is ₹9 crore. |
| A Rajkot pump maker | ₹12 crore | ₹80 crore | ₹6 crore | Small |
| An Ahmedabad interior design studio with 12 staff | ₹40 lakh in computers and equipment | ₹3 crore | Nil | Micro |
02How to register
- Go to the official portal, udyamregistration.gov.in. Registration is free.
- Enter Aadhaar of the proprietor, managing partner, karta or authorised director, and verify with the OTP.
- Enter PAN. The portal fetches investment and turnover data from government records linked to it.
- Fill in the business details: name, type of organisation, address, bank account, main activity, NIC codes for what you make or do, and number of employees.
- Submit. The registration number is issued on submission and the certificate follows.
No documents need to be uploaded. The details are self-declared and checked against PAN and GST data.
If you have more than one business activity or unit on the same PAN, they all go in one Udyam registration.
Without GST or PAN
For informal micro businesses with no PAN or GSTIN, the Udyam Assist Platform allows registration through designated agencies such as banks and SIDBI. It counts for priority sector lending.
03What Udyam registration gives you
Payment protection for micro and small suppliers
Under sections 15 and 16 of the MSMED Act, a buyer must pay a micro or small supplier within the agreed period, which cannot be more than 45 days from acceptance of the goods or services. Where there is no agreement, the limit is 15 days. Late payment carries compound interest at three times the bank rate notified by RBI, with monthly rests.
If a buyer does not pay, a micro or small supplier can file a case on MSME Samadhaan with the state's Micro and Small Enterprises Facilitation Council.
Income tax law also links a buyer's deduction for such dues to timely payment: amounts owed to micro and small suppliers beyond the MSMED Act limit are allowed as an expense only when they are paid. Large buyers now track Udyam status of their suppliers closely for this reason, and many ask suppliers to share their certificate.
Credit
Loans to MSMEs count as priority sector lending for banks. Collateral-free credit under the Credit Guarantee Fund Trust for Micro and Small Enterprises is linked to Udyam registration.
Government purchases
Under the public procurement policy, central government buyers aim to buy a share of their needs from micro and small enterprises, and MSEs are usually exempt from tender fees and earnest money deposits. Udyam registration is the proof used on GeM and in tenders.
04Keeping it up to date
Update your Udyam registration when your business changes: a new unit, a new activity, a change of address or bank account. Investment and turnover update from tax records each year, and your category is revised accordingly. A business that grows past a limit moves up a category. This is worth watching in the year a large order or a new machine pushes you over a line.
05Traders
Retail and wholesale traders can register on Udyam, and their registration counts for priority sector lending. The other benefits, including the delayed payment protections, are meant for manufacturers and service providers.
06Udyam and GST registration together
Udyam and GST are separate registrations under different laws. GST registration depends on turnover and the kind of supplies you make. Udyam registration is voluntary, but most of its benefits depend on having it. A business that is required to have a GSTIN must give it in the Udyam form, and the turnover the Udyam portal uses comes from GST and income tax records.
07Avoiding paid look-alike sites
Several private websites look like the Udyam portal and charge a fee for registration or for a "renewal". There is no fee and no renewal. Use only udyamregistration.gov.in, and never share an Aadhaar OTP with an agent you do not know.
08When your category changes
A Rajkot pump maker that buys a ₹15 crore line of CNC machines moves from small to medium once the investment shows in its income tax return. As a medium enterprise, its sales are no longer covered by the MSMED Act's delayed payment protections, which apply to micro and small suppliers. Planning a big investment with this in mind is part of the decision.
This guide is general information as of October 2026 and does not amount to tax or legal advice.
MatruOS needs no Udyam or GST number to sign up, so you can start before either is in place.