In India, fostering the growth of Micro, Small, and Medium Enterprises (MSMEs) is paramount for economic development and job creation. To streamline this sector, the government has introduced various schemes and registrations aimed at providing benefits and support to MSMEs. Two such registrations often confused are the Udyam Registration Certificate and the MSME Registration Certificate. While they may seem similar, there are significant differences between the two that entrepreneurs need to understand to make informed decisions about their businesses. Let’s delve into these disparities and unravel the complexities surrounding Udyam Registration and MSME Registration.

Understanding Udyam Registration:

Udyam Registration is a recent initiative launched by the Government of India to replace the erstwhile process of MSME Registration. It falls under the ambit of the Micro, Small, and Medium Enterprises Development (MSMED) Act, 2006. The primary objective behind Udyam Registration is to simplify the registration process and provide various benefits to MSMEs, including easier access to credit, subsidies, and government schemes.

Key Features of Udyam Registration:

Online Registration: 

Unlike the earlier process, which involved paperwork and multiple visits to government offices, Udyam Registration can be done entirely online through the Udyam Registration Portal.


One of the significant changes introduced with Udyam Registration is the concept of self-declaration. Enterprises can self-certify their existence, investment in plant & machinery or equipment, turnover, etc., without requiring any supporting documents at the time of registration.

Classification Based on Investment: 

The classification of MSMEs under Udyam Registration is based on their investment in plant & machinery or equipment and turnover. Micro, Small, and Medium enterprises are defined based on these criteria.

Unraveling MSME Registration:

MSME Registration, on the other hand, has been in existence for a longer time and was the primary mode of registration for small businesses before the advent of Udyam Registration. It provides the enterprises with a certificate specifying their MSME status, which is useful for availing various benefits provided by the government.

Key Features of MSME Registration:

Document-Based Process: 

Unlike Udyam Registration, which relies on self-declaration, MSME Registration requires the submission of documents such as Aadhaar card, PAN card, business address proof, etc.

Permanent Registration: 

Once registered under MSME, the enterprise retains its MSME status permanently, irrespective of its growth in size or turnover. This provides stability and credibility in the business ecosystem.

Eligibility for Government Schemes: 

MSME Registration enables businesses to participate in various government schemes aimed at promoting MSME growth, such as subsidies, incentives, and procurement preferences.

Contrasting the Two:

Now that we’ve outlined the key features of both Udyam Registration and MSME Registration, let’s compare them to understand their differences more clearly:

Registration Process: 

Udyam Registration offers a streamlined, online registration process with minimal documentation, whereas MSME Registration involves a more traditional, document-based approach.


Udyam Registration needs to be renewed periodically based on self-declared information, while MSME Registration is permanent.

Classification Basis: 

Udyam Registration classifies enterprises based on investment and turnover, whereas MSME Registration is solely based on investment in plant & machinery or equipment.


Both registrations offer similar benefits in terms of access to credit, subsidies, and government schemes, but the process of availing these benefits may differ.


Note: You Can Apply for Udyam Re-Registration Through Udyam Portal



In conclusion, while both Udyam Registration and MSME Registration serve the common goal of supporting and promoting the growth of MSMEs in India, they differ significantly in their approach, process, and features. Entrepreneurs must carefully evaluate their business requirements and objectives to choose the most suitable registration option. Whether opting for the simplified self-declaration process of Udyam Registration or the traditional document-based approach of MSME Registration, the ultimate aim remains the same – leveraging government support to propel business growth and contribute to the nation’s economic development.