What is Udyog Aadhaar and How Does it Benefit MSMEs?

Posted on Wednesday, October 16th, 2024 | By IndusInd Bank

You must be familiar with the Aadhaar number issued by the Unique Identification Authority of India (UIDAI), which serves as an identity and address proof for all citizens. But did you know there is a similar identification document for businesses called Udyog Aadhaar? Udyog Aadhaar is particularly tailored for businesses to access funding and government support.

Introduced in 2015 by the Central Government, it simplified the registration process for Micro, Small, and Medium Enterprises (MSMEs). Before this, entrepreneurs had to undergo a paper-based, tedious registration process.

With Udyog Aadhaar registration, MSMEs receive distinct benefits aimed at fostering their growth. Continue reading to learn more about Udyog Aadhaar, what is it called now, benefits involved, and the new registration process.

What is Udyog Aadhaar?

Udyog Aadhaar, now called Udyam Registration, is a 12-digit unique identification number issued by the Ministry of MSME. After registering, business owners get an Udyam Registration Certificate, which was earlier known as Udyog Aadhaar Certificate. In simple words, it serves as an identity proof, much like the personal Aadhaar, but particularly for MSMEs.  

Benefits Offered to MSMEs

1) Excise Duty Exemption and Tax Relief

MSMEs registered under Udyog Aadhaar qualify for excise duty exemption and other tax benefits, which assist in lowering operational expenses.

2) Reduced Fees for Trademarks and Patents

MSMEs can avail lower fees for registering trademarks and patents, encouraging brand protection and innovation.

3) Government Schemes

Business owners benefit from government schemes such as loans without guarantees, low interest rates on loans, and various subsidies.

4) Financial Aid for Foreign Trade

The government offers financial aid to MSMEs engaged in international trade, promoting global business opportunities.

5) Concession on Electricity Bills

Registered MSMEs may get concessions on their electricity bills, reducing their overhead expenses.

6) ISO Certification Reimbursement

The government reimburses the costs associated with obtaining ISO certification, ensuring that MSMEs can maintain high standards.

7) Simplified Licenses, Registrations, and Approvals

The process of availing distinct licenses, registrations, and approvals becomes streamlined, saving plenty of time and effort for business owners.

Opening a Current Account with IndusInd Bank

Opening a current account is essential for MSMEs because it facilitates efficient cash flow management and separates business and personal finances, ensuring better financial tracking and accountability. It also enhances the business’ creditworthiness with suppliers and customers by offering a professional banking interface.

One such current account that you may consider opening is the Indus Tarakki Current Account by IndusInd Bank. This account is particularly tdesigned for traders, retailers, and merchants to enjoy seamless digital collections and other benefits. These benefits include:

Also Read: What Is a Current Account and How to Open It in a Bank?

Udyog Aadhaar – New Rules You Must be Aware of

In 2020, the Central government launched the Udyam Registration portal, replacing Udyog Aadhaar. As per the new rules, new enterprises can register using their Aadhaar number and a self-declaration. The enterprise’s details can be verified using PAN or GSTIN.

Steps For Udyam Registration for MSMEs

• Visit the official site at Udyam Registration
• Click on the ‘Udyam Registration Form – For New Enterprises Not Registered as MSMEs’ link
• Input the Aadhaar number and the entrepreneur’s name
• Validate and generate OTP to proceed
• Choose the enterprise type and fill out the required details
• Submit the form and receive a confirmation message on your registered email ID and mobile number
• The Udyam Certificate will be emailed to you

Key Takeaways

Udyog Aadhaar, now called Udyam Aadhaar, is a critical initiative for MSMEs, offering distinct benefits such as financial aid, tax relief, and simplified processes. Opening a current account, like the Indus Max Current Account by IndusInd Bank, offers further benefits to MSMEs, making business operations more efficient and smoother.

So, do not delay – open a current account with IndusInd Bank today and enjoy seamless banking solutions!

Apply now!

Disclaimer: The information provided in this article is generic and for informational purposes only. It is not a substitute for specific advice in your circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any financial decisions based on the contents and information.