December 25, 2020
The ‘big digital shift’ saw a significant increase in tech adoption among SMEs and MSME as against the 29% Pre-COVID proportion.
Gems & Jewellery sector led in tech adoption followed by the Textile Sector.
50% of MSMEs incorporated WhatsApp and Video Conferencing tools into their daily business operations.
Experts project that the MSME space will be instrumental in creating close to 90mn jobs by 2030.
The COVID-19 pandemic is facilitating a significant shift from the traditional approach to the digital medium among the MSME ecosystem. Termed as the ‘big digital shift’, CRISIL reports that 47% micro enterprises and 53% of SMEs adopted digital sales platforms as against the Pre-COVID figure of 29% among the 566 MSEs surveyed. The turnover of the participants ranged from US$ 6,81,973- US$ 3mn. The Gems & Jewellery sector and the Textile Sectors are among the leading sectors to embrace the ‘big digital shift’ Another survey by the Endurance International Group reveals that 50% of them incorporated technologies like WhatsApp and Video Conferencing tools for daily business operations. SMEs were also among the 40% of the companies surveyed by FICCI and Dhruva Advisors that exhibited a 40% increase in exports since the August 2020 period.
The MSME space in India has been identified for its potential to put the Indian economy on the path towards recovery from the impact of COVID-19 pandemic. Experts project that the sector which is currently the largest employer in India, will be instrumental in creating close to 90mn jobs by the year 2030. While digitisation can prove to be an important contributor to the growth of MSMEs, there are several hurdles that will need to be overcome in order to reap its benefits. The lack of access to quality technology and the requisite tools to train staff in the nuances of social media and the portals of e-commerce engagement is one of the foremost challenges identified by experts. It is imperative that the sector be given increased support from a skill development, capacity building and technological perspective so as to overcome these challenges on a long term basis. Furthermore, there is greater scope to tailor legislative measures and incentives to the requirements of the sector such that it is protected from any loss. With adequate support from the Government of India, the MSME space can continue its growth into a key site of national development and self sufficiency.