Categories of ISP License in India

June 05, 2023

Registrationwala

The use of the internet has increased rapidly in the last few years and now it has become a part of day to day life. Everyone needs an internet connection, there is an increase in demand. To start an Internet Service Provider (ISP) business, one should have an ISP license.

Before jumping into the application process, you must know the details and categories of ISP licenses. It will help you decide which category license you need and how much it will cost you.

What is an ISP License in India?

Internet Service Provider (ISP) License is services to provide internet services to individuals or businesses. The Government of India came up with one license for all telecom related services known as Unified License.

In this, a service provider can apply for ISP license authorization of different services in different areas. An individual or company must have a Unified License to obtain authorization to provide internet services. A company can hold only one license to provide services.

ISP Licenses Category in India

In India, there are three types of categories of ISP license to obtain a license and provide internet services. The type will depend on the scale of city, state, town, district or village. Basically there are three types of ISP licenses which are differentiated by the scale of coverage area/ territory.

Class A - National Area
Class B - Metro Area/ Telecom Circle
Class C - Secondary Switching Area

ISP License Class A

This license is for PAN India operations which means the services can be provided all over India. License holders of class A ISP are very few in India because of the high license fees.

If we talk about the entry fees, it is 30 lakhs and the application fee is 50 thousand. This fee is not negotiable, that's why it is called foundation fees.

However, having a class A license is lucrative and if you have good funding, and are willing to have a unified license in category A then apply for ISP license.

ISP License Class B

If someone wants to provide internet service and have a Class B license, then it means the service can be provided in 20 major states or any of the following metro cities: Mumbai, New Delhi, Kolkata, Chennai, Bengaluru, Pune, Ahmedabad and Hyderabad.

However, for a new business the class B license will cost 13 lakhs and 15 thousand in total. So to operate ISP business in urban areas, one should choose a unified license in category B.

ISP License Class C

This license is only for a particular secondary switching area which is defined by the government and it can be a composition of several small villages, towns or districts. A class C license holder will only have access to 1 particular Secondat Switching Area (SSA), until he applies for the unified license.

As compared to the other two licenses, applying for a Class C license is inexpensive. In total it will cost you 90 thousand. For many startups it is a great way to start ISP services, if you want to provide internet services in a small town, village or district, go for an ISP class C license.

Fees Structure of an ISP License

Following are the fees for ISP different category licenses. To obtain an ISP license in India, one must have the below mentioned fees to start an ISP business.

Services	Minimum Equity	Minimum Net Worth	Entry Fees	Performance BG	Financial BG	Application processing Fees	Total Capital Required
ISP A	Nil	Nil	30 Lakhs	2 Crores	10 Lakhs	50 Thousands	2,40.50,000
ISP B	Nil	Nil	2 Lakhs	10 Lakhs	1 Lakh	15 Thousands	13,15,000
ISP C	Nil	Nil	20 Thousands	50 Thousands	10 Thousands	10 Thousands	90,000

Note: All the above amount is in Indian Rupees.

Procedure to Apply for ISP License

Following is the process to apply for an ISP license:

Establish a private or public limited company.
Choose the category which suits your goal and budget.
Connect with a service provider who provides you a bandwidth which you will resupply. Once you find the provider, sign a DOT ISP license agreement.
File the application with all information and required documents.
After getting the documents, the department of telecommunication will review and at this stage it will decide if your application will move for an ISP license or not. Here our experts will check the status repeatedly because they know how to check the status of an ISP license in India.
Once your application gets accepted. The department will send you a letter of intent. Here you have to pay bank guarantees depending on your license. Follow a prescribed format for ISP bank guarantee. Reach out to us, we will file the guarantee on your behalf.
Once your letter of intent is submitted successfully, you will receive an ISP license.

Conclusion

If a Department of Telecommunication (DOT) is delaying the process to give response and raise an issue regarding incomplete application and documents, non-compliance, etc.

To avoid such rejection on application in any category, hire Registrationwala to review your documents, and file application on your behalf to the department. The ISP licensing process is technical and has minor details which need to be filled carefully. It is always advisable to hire a professional to save time and money.