Micro, Small and Medium Enterprises (MSMEs) in India play a crucial role in generating job opportunities at lower capital costs and making a considerable contribution to GDP of the Indian economy.
Every sector in India majorly MSMEs are undergoing the transformation owning to digital platforms by introducing new-age technologies such as artificial intelligence, data analytics, financial and accounting intelligence.
Most often, new-age technologies are also boosting new business models in MSMEs sectors such as the following:
Brego - Offer real-time insights into a firm’s financial data.
LendenClud – Connect lenders and verified borrowers through its platform.
RazorpayX - It allows businesses to do everything from open a current account, track invoices, schedule payments, pay tax and so on.
PayNearBy - PayNearby is a fintech company that discovers technology and distribution networks to reach financial/non-financial services in India.
Meesho – Allowing small businesses to sell products online through various social media platforms.
These technologies are designed to aid MSMEs to automate and generate intelligence through day-to-day operations or by connecting with stakeholders such as buyers, suppliers or financial institutions, by doing so they would increase productivity and innovate further.
Even, the Covid-19 pandemic has been a part of pushing this sector to uptake newer technologies and innovations for the growth and survival of business.
Approximately, there are 63 million MSMEs in India. Based on the 73rd national sample survey (NSS) conducted between the financial year 2015 and 2016 - reported that the MSME sector has generated 11.10 crore job opportunities across the country with a 22% jobs contribution in India.
Liberalised FDI Policies & Government Schemes Uplifting MSMEs
Under the automatic route, India has liberalised FDI policies that permit 100% in most of the sectors including MSMEs.
The FDI policy on “Single Brand Product Retail Trading” has grant a major boost to the MSME landscape in India.
Acknowledging the significant contribution of MSMEs to India’s economic growth, the government also supports the sector with various business loan schemes and other credit programs.
Also Read:- Top 5 Startup Business Loan Schemes by Indian Government
Upgrading with technology adoption has seen an opportunity to utilizing technology effectively in the entrepreneurial ecosystem.
If we talk about today’s business survival, even a small enterprise needs a computer, a mobile phone, a printer, a scanner, and much more to run an organization.
Moreover, it's rare to see a business owner sitting with the same group of people. To enhance sales and productivity, the size of set-up gets increased by multi-location built-up, multi-city and the number of employees in an organization has increased by a thousand times.
Now, they are moving their preference towards software applications that use apps to share work, make decisions, handle time-bound processes, and manage cash flow.
In such a way, the entire software-driven organization is becoming a technology-enabled organization.
Upcoming tech-based platforms are now aiding MSMEs to upscale and integrate their operational capabilities.
Most of the tech-based platforms of various domains are helping them to cater to various facts of MSME operations including planning supply chain, channelizing workflow, logistics and supervising product quality.
Various tech-based start-ups are empowering Indian MSMEs by providing new-age technology solutions such as offering data insights, artificial intelligence, machine learning and so on are helping MSMEs empowering the full potential of technology.
LendenClub – Founded in 2015, LendenCludb is one of the fastest-growing platforms in India, bringing lenders and verified borrowers together.
This platform helps in facilitating small-ticket loans and addressing borrower's concerns through its platform Instamoney to MSME.
So far, the company has serviced more than 2 million clients and disbursed approximately 10 billion (US$ 132.8 thousand).
Brego – It’s a Mumbai-based Brego company established in 2019, helping MSMEs to get real-time insights from their financial data with the help of a mobile-based SaaS application.
The app gives easy access via mobile phones and web browsers to know key financial parameters such as sales, receivables, profit & loss and cash flow to stakeholders.
It also enables business owners to share real-time reports with team members, clients and vendors through WhatsApp or email.
PayNearBy – Established in 2016, PayNearBy is India's largest fintech network boosting local retailers by offering a wide variety of financial as well as non-financial digital services.
In current, with a robust network of 15 lakh+ retailers. Through paynearby, retailers will get access to various facilities such as cash deposits & withdrawals, money transfers, savings, insurance, digital payments and other benefits offered by the government.
Alignbooks – Set up in 2016, Alignbooks is a cloud-based accounting software developed to aid MSMEs to automate their invoicing system.
It aims to transform business operations and deliver the right technology that fits the vision of the organization.
So far, the alignbooks has serviced over 30,000 MSMEs in India and processed over 15 lakh invoices for customers.
Meesho – Launched in 2015, which headquartered in Bengaluru. Meesho is one of India's favourite one-stop online shopping points from which one can purchase or earn money online.
Meesho allows small businesses and individuals to sell products online through social media channels such as WhatsApp, Facebook and Instagram.
Moreover, In August 2020, Meesho also partnered with fintech start-up Klub to provide financing solutions for MSMEs.
Trade India – Launched in 1996, Trade India is India's largest B2B portal with over 5.8 million strong networks.
With a mission to help small-medium enterprises (SMEs) upgrade their businesses digitally. The marketplace serves as a platform to buy India’s products.
Apart from connecting buyers and suppliers, the company also provides services such as payment protection plans, collateral-free loan, and logistics.
TradeIndia is the first company in the country that provides e-commerce and solutions for booking domains, SSL, Adword, SMO and FB Promotion to SMEs.
Tech dominant players such as Amazon and Flipkart are also empowering MSMEs with their tech offerings.
For example, Flipkart has launched several initiatives to support MSMEs—the Samarth Programme, which is onboarding Indian artisans, weavers and handicraft producers onto e-commerce.
Likewise, in recent times, Amazon launched “Digital Kendras” to encourage business owners and make them learn about the benefits of digitizing their operations. As of April 2021, Amazon has digitized 2.5 million SMEs in India.
Based on a survey conducted in 2020 by Endurance International Group, an IT services company reported that approx. 30% of MSMEs small businesses started launching their official website and some are shaking hands with e-commerce platforms.
Tech-based solutions have great potential to scale-up MSME Sector.
Increased technology skillset among the educated young population results in scaling up businesses and favorable government policies are the main reason behind tech-based solutions empowering Indian MSMEs.
Also Read: MSME Loan for New Business - Check Eligibility & Interest Rate
CA Vikas Jain - Our Mentor
9863-02-02-02