NIC Code for Udyam Registration: Importance, Applications, and Steps to Choose the Right One

The National Industrial Classification (NIC) code is a numeric code system developed by the Government of India to classify and organise various business activities. It is used by statistical and economic departments for data collection, foreign trade analysis, and business regulation. The NIC code plays an important role in business identification, especially for MSMEs registering under the Udyam portal. It helps streamline licensing, compliance, and government benefits distribution. Every type of economic activity—from manufacturing to service-based sectors—has a unique NIC code assigned to it for standardised classification.

Applications with NIC codes

NIC codes are essential for multiple government and business processes in India. They provide clarity about the nature of operations and ensure businesses are correctly identified for taxation, policy benefits, and compliance. While registering on the Udyam portal, businesses must choose the right NIC code to avail schemes and subsidies. These codes also help financial institutions, such as banks and NBFCs, assess business sectors while providing credit. Apply for our business loan to take advantage of financing options that align with your industry and growth plans.

• Udyam MSME registration and certification
• Company incorporation through MCA or ROC
• Filing Goods and Services Tax (GST) returns
• Availing government subsidies and schemes
• Applying for bank credit and business loan approvals

Example of NIC code structure

The NIC code follows a systematic and hierarchical format. It is generally structured into two, three, four, and five-digit levels depending on the specificity of the business activity. Each section and division categorises a broader area, followed by subclassifications for accuracy. Understanding the structure helps businesses choose the exact match for their activity during registrations.

• Section C – Manufacturing
• Division 29 – Manufacture of motor vehicles, trailers
• Group 291 – Manufacture of motor vehicles
• Class 2910 – Motor vehicle manufacturing
• Sub-Class 29101 – Manufacture of passenger cars

List of NIC code

NIC codes are organised by divisions, each representing a particular industry or sector. The following table lists a few major divisions commonly used during Udyam registration. Businesses must refer to the detailed NIC code list provided by the Ministry to ensure proper selection.

Division	Industry category
01	Agriculture and Allied Activities
10	Manufacture of Food Products
13	Manufacture of Textiles
27	Manufacture of Electrical Equipment
41	Construction of Buildings
45	Wholesale and Retail Trade, Repair of Vehicles
62	Computer Programming and IT Services
70	Real Estate Activities
86	Human Health and Social Work Activities
96	Other Personal Service Activities

Importance of NIC code for Udyam registration

NIC codes are mandatory while registering under Udyam for MSME classification. They ensure precise identification of business activities, enabling better policy-making and fund allocation. A correct NIC code helps businesses access relevant government schemes, financial support, and subsidies. For Indian MSMEs, it also ensures compliance with statutory obligations and promotes easy access to benefits provided by ministries and banks under various development programmes. Want to see if you already qualify for financing? Check your pre-approved business loan offer and take the next step toward business growth.

How to choose the right NIC code

Selecting the correct NIC code is crucial for Udyam registration and related filings. An incorrect code can lead to delays, ineligibility for government schemes, or compliance issues. Businesses should carefully analyse their core activities, refer to the NIC list, and use government tools for accuracy. Cross-verification with industry bodies or professionals is also recommended.

• Identify your business’s core activity
• Refer to the latest NIC code directory
• Use search filters on the Udyam portal
• Choose the most relevant five-digit code
• Consult with a professional to avoid errors

Conclusion

The NIC code serves as an essential identifier for businesses in India, streamlining their classification across government and financial platforms. It simplifies the Udyam registration process and unlocks access to credit, subsidies, and compliance benefits. Whether applying for subsidies or a business loan, selecting the correct NIC code ensures your business remains eligible, compliant, and well-recognised across various administrative systems.