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Vendors send different MSME documents and the buyer cannot tell which ones prove current status.
Accept only a Udyam number verified on the portal, then read its tier and principal activity.
Vendor master fields for Udyam number, registration date, tier, activity and date verified.
Each vendor tagged as valid Udyam, legacy-only or trader, with the payment rule that applies.
Only a Udyam registration counts as MSME registration today. The Udyam portal has issued registrations since 1 July 2020, with a number in the format UDYAM-XX-00-0000000. Udyog Aadhaar numbers and older MSME or SSI certificates are legacy documents, and even a Udyam certificate PDF should be checked on the portal before you rely on it.
What does each document prove?
| Document | What it is | Accept it today? |
|---|---|---|
| Udyam registration | Current registration under the MSMED Act 2006, issued online from 1 July 2020, with tier and activity drawn from tax and GST data | Yes, after verifying on the portal |
| Udyog Aadhaar memorandum (UAM) | Self-declared registration used from 2015 until Udyam replaced it | No, ask the vendor to move to Udyam |
| Older MSME or SSI certificate | Paper-era registration from district industries centres | No, legacy only |
| Udyam certificate for a trader | Registration allowed for priority-sector lending | Valid as registration, but generally outside the payment rule |
The main difference is how the data is checked. Udyog Aadhaar relied on what the business declared. Udyam pulls investment and turnover figures from income tax and GST records, so the tier it shows is harder to inflate.
My supplier sent a certificate. What should I check?
- Number format: it should read UDYAM, then a two-letter state code, a two-digit district code and a seven-digit serial.
- Portal check: verify the number on the Udyam portal and match the name and PAN to your vendor master.
- Tier: micro or small brings the 15 and 45-day rule; medium does not. The current limits run up to ₹10 crore turnover for micro and ₹100 crore for small.
- Principal activity: manufacturing or services. A trader classification usually takes the supplier outside the delayed-payment protection.
- Date: record when you checked, and recheck each year before 31 March.
Can a supplier claim MSME status without a Udyam number?
This is a point on which practitioners differ. Some commentary on Section 43B(h) of the Income-tax Act 1961 says registration is not compulsory and a supplier’s declaration may be considered. Our vendor-verification guide takes the stricter line: treat a verified Udyam number as the test, and ask any supplier claiming MSME status without one to register. Because the cost of getting it wrong is an add-back in your tax computation, agree the position with your CA and apply it the same way to every vendor.
Worked example: three vendors on one payables list
| Vendor | Amount payable | Document provided | Tag |
|---|---|---|---|
| A, machining services | ₹6,40,000 | Udyam number, verified, small, services | Valid Udyam: rule applies |
| B, packaging supplier | ₹2,15,000 | Udyog Aadhaar only | Legacy: ask to register on Udyam |
| C, stationery trader | ₹90,000 | Udyam number, verified, trader | Registered trader: generally outside the rule |
Total payables are ₹6,40,000 + ₹2,15,000 + ₹90,000 = ₹9,45,000. Only vendor A’s ₹6,40,000 is clearly inside the 45-day rule. Vendor B’s ₹2,15,000 needs follow-up before year-end, because if B registers and is small, those dues come into scope.
Write the Udyam number, registration date and tier in the vendor master, not just in a folder of PDFs.