The future of SMEs in Digital India

One of the most important and key drivers of socio economic growth across the nation is the Small and Medium Enterprise Sector. The small businesses contribute about 45% of the India’s GDP, which is triple of what the Corporates contribute, as reported by the Future of Business Survery.The SME sector employs closeto 46 crore people andis growing at a rate of 11.5% annually. The Government has recognized the SME sector as the backbone of the economy and the Prime Minister announced a scheme under which the government had doubled the limit of loans raised by the SMEs to 2 crore. This includes the loans from NBFCs. In addition,the Banks were asked to raise the limit of cash credit offered to SMEs from 20% to 25%. GST bill is expected to have a positive impact on the sector. It is aimed at eradicating the indirect taxes,increasing transparency and allowing access to new locations for the purpose of business expansion. With the SMEs across India touted to be a $25.8 billion market for emerging technologies, the rise of B2B ecommerce is also expected to gain momentum in the year. 

The Future of Business Survey is an ongoing collaboration between the World Bank, Facebook and the OECD, which focuses on the SMEs across the globe. The survey was introduced to help businesses succeed by understanding the economic environments in which they function. It also enables the businesses to share the learnings as well as the challenges and opportunities that will help them grow. The survey was undertaken by 2,00,000 SMEs across 40 countries. This involved 70 million businesses in the survey. The survey also included a module on education in order to understand how the businesses are learning and the gaps perceived by them. In the survey, it has been noted that about 42% businesses said that they learnt from one another and that is a primary method of finding new information. The first way of learning was mobile searches which was opted by 64% businesses.

The SMEs is navigating into the complex technology and turning to one another in order to learn and share new ideas. They basically are showing that when businesses learn from one another, they find success. Across India, we can see a clear optimism in the economy with about 41% businesses being confident about the economy. We also notice an increase in international trade across the nation which helps businesses scale geographically and learn more from their counterparts. Further, there is a noticeable increase in jobs across the SME. 41% businesses have added jobs in the last six months and this momentum is expected to continue in the coming quarters as well.

The technology and the power of networks has been the driving force for the success of SMEs, it fosters inclusiveness and allows stronger economic and social growth. With an increase in startups and the ease of doing business across the Country, there will be an acceleration in entrepreneurship, diversity across the industry and the peers will help businesses grow. SMEs will start contributing more to the economy in the form of revenues as well as job creation. The Government is constantly taking measures to help the SMEs build and grow.