The Udyam registration is essential for every entrepreneur in India. The Udyam registration process is simple and easy online. In the Udyam registrations, the “National Industrial Classification” (NIC) code plays a major role. In the registration process, entrepreneurs are choosing the NIC code based on those business activities. The NIC code represents the classification of economic activities. The NIC code supports the maintenance of the collection of data, processing, and presentation. These classifications are used in policy formation and policy analysis, population counts, and statistical surveys in India.
The NIC code choice is very simple. Because the entrepreneurs are having the list of NIC. Only choosing the NIC code based on those business activities. If you can make a change in your business activity after updating the Udyam registration certificate and also updating the NIC code.
Obligation to provide NIC code:
It is the official classification system for categorizing and measuring productive economic activities.
It is utilized to categorize the active economic participants, industrial activity, disturbing trends, and macroeconomic data like national income.
It is commonly used by various government institutions, business associations, and research entities that rely on it for administrative tasks.
These classifications are used to support formulating economic policies and allow for global economic comparisons.
The NIC code is required for government registration of Udyam registration.
How to choose an NIC code for Udyam registration:
Step 1: Understand the Business Activity
First, you have to have clarity about your business's primary; for example, is your business activity manufacturing, trading, or services?
In case you run multiple business activities, identify the primary and secondary ones.
Step 2: Access the NIC Code Index:
Visit the official Udyam registration portal.
Go to the “Add plant” section and enter your business type to display the relevant NIC codes.
Step 3: Check the standard NIC code index.
You can download the NIC code list.
The NIC code number contains a 2-to-5-digit number.
Step 4: Select the NIC codes:
In yours, which runs various activities, Udyam registration allows you to choose up to 10 NIC codes.
Be careful to choose the NIC code based on your primary and secondary business activities.
Step 5: Cross-check the GST registration or other business licenses.
Use the NIC code aligned with your GST or other regulatory filings.
DOs and DON’Ts:
Do not select randomly. A wrong NIC code could disqualify you from MSME benefits.
Provide specific details when possible—use 5-digit codes for improved clarity over 2-digit codes.
Your NIC codes are updated with your business updating; this is very important.
You Can Apply for Update Udyam Certificate Through Udyam Portal
Conclusion:
The “national industrial code” (NIC) is classified economically based on the type of business or service provided. And also, identify your business activity for MSME schemes. Choosing an NIC code is very easy and simple when you have clarity about your business's primary activity. You can choose the correct code on NIC; it is helpful for MSME schemes, or you can choose the wrong NIC code if you can’t access proper MSME schemes. Because the choice of NIC code is very important.
