Introduction
Udyam Registration is an initiative by the government of India to promote, support, and formalize micro, small, and medium enterprises (MSMEs). This online registration process was made to make it easier for businesses to access various benefits, including financial aid, subsidies, and ease of doing business. Even though Udyam is important and makes it easier to get capital via sme loan and other forms, some MSMEs might want to cancel or withdraw their registration due to reasons like a business closure, a change in the business structure, or any other administrative reason.
This guide will help you understand the process one needs to follow to successfully cancel their Udyam Registration without any hassles.
How to Cancel Online MSME Registration
On the official Udyam Registration portal, you can cancel or withdraw your MSME registration. The Indian government made it easier and hassle-free for business owners to operate such an online process through user-friendliness throughout the country.
Steps for online cancellation or withdrawal of Udyam Registration are:
Step 1: You need to visit the Udyam Registration portal
This is a government portal https://udyamregistration.gov.in, through which anyone can do MSME registration and many related activities.
Step 2: Log In with Your Registration Details
Log in at the top of the portal’s homepage. Update/Cancel Udyam Registration Click on this. Now you will have to enter the Udyam Registration Number (URN) and mobile number or e-mail address you used to create the account. You would need to verify using an OTP sent to your registered mobile number or e-mail address. Type in the OTP to log into your account safely.
Step 3: Click on “Cancel Udyam Registration”
Log in once and click on the “Manage” section or something similar as provided on the portal. In this section, you will find an option to update or cancel your registration. Click on “Cancel Udyam Registration” to proceed further.
Step 4: Reason for Cancellation
You will be requested by the system to mention the valid reason for cancellation of Udyam Registration. Fill that form honestly and in the specific manner required. Closely aligned with closure of business or change of eligibility for availing the facilities, to make sure a smooth cancellation process happens for it.
Step 5 Confirm your cancellation request
Then, you will be asked to confirm your decision. You will have to check your details once again and then click on “Submit.” Your cancellation request will be recorded and you may receive an acknowledgment receipt or email stating that your submission was confirmed.
Step 6: Waiting for Confirmation
After the cancellation request, the Udyam Registration portal will process your application. Once your registration is canceled, you will receive a confirmation message or email. Keep this confirmation because it will be helpful in the future or for proving cancellation.
Reason to Cancel Udyam Registration
Cancelling Udyam Registration is one of the major decisions a business owner takes, as he loses the privilege of using the facilities and support services provided to the MSMEs. Following are some of the main reasons a business owner would cancel his Udyam Registration:
1. Business Shut Down
Closing down the business is the most common reason for the cancellation of Udyam Registration. Most small businesses face financial problems, market competition, or other issues that lead to closing down their operations. In such cases, the registration needs to be canceled to avoid unwanted compliance and tax requirements.
2. Change in Business Size or Structure
If the business becomes more prominent in comparison with the specified limits for investments and turn-over under the MSME Act, the entity would then cease to qualify as an MSME. Those are classifying businesses because they eventually go over and beyond such specified limits to be hence not considered or eligible anymore to MSME benefits. Hence, a preferable choice on the issues with respect to non-compliance would then be cancellation or update Udyam Registration.
3. Change of Ownership of the Business, Merger:
In case a business is either transferred or merged, then the owners may not have the interest to retain Udyam Registration. In some cases, this may specifically happen when they have other strategies or plans for that business. Some of these businesses that are merged or restructured may also be left out of MSME registration, and hence there would be a need for the previous registration to be cancelled.
Sometimes, people register twice or get double registration. In such situations, they must cancel the double registration so that there won’t be confusion and also to be under the law.
4. Registration Information Mistakes
If the information in Udyam Registration is incorrect about name, address, and kind of business, then a businessman may seek cancellation of that registration and apply again for registration. Any business-associated details may be correct along with avoidance of complications afterward.
5. No Longer Eligible for MSME Benefits
Cancelling Udyam Registration is a major step for any business in case of shutting down, merging, or any kind of structural change. Currently, through the online procedure on the Udyam Registration portal, one can withdraw or cancel their registration within a few easy steps. Just ensure you retain your Udyam Registration Number (URN) and your registered mobile number or email, as you would require the same to log in to your account.
Conclusion
It is always important to know you want to cancel your Udyam Registration and go ahead and follow the steps for the cancellation. Through the knowledge of reasons and following the steps listed, business owners would find it easy to keep their registration status in hand to avoid confusion in official records.
For MSMEs, NBFCs are crucial as some of the sectors require short-term funding or seasonal demands for getting short-term or long-term collateral free business loan with a reasonable structure of repayment at a minimal security amount besides, even most NBFCs offer particular type of loans for MSME that includes; Machinery Loan Working Capital Business Expansion. In this way, NBFCs are an essential support system, allowing MSMEs to compete, grow, and contribute significantly to India’s economic development.