Key Findings from the ICRIER Survey
Ecommerce Helps MSMEs Secure Finance
- 51% of ecommerce-integrated MSMEs found their digital presence useful for securing external finance from banks and NBFCs.
- Medium-sized firms (60%) benefited the most, followed by small (55%) and micro (48%) enterprises.
- 30% of integrated firms were able to secure collateral-free loans, with medium enterprises (33%) leading the trend.
Challenges Faced by Non-Integrated MSMEs
- Market access and financing are the biggest hurdles for non-integrated MSMEs.
- One-third of non-integrated firms listed these as their top five challenges.
- Other difficulties include:
- Customer retention
- Hiring skilled employees
- Effective product marketing
Low Participation in Government Schemes
- 55% of MSMEs have not accessed government support programs in the past three years.
- Non-participation rates:
- Micro enterprises – 54%
- Small enterprises – 55%
- Medium enterprises – 60%
MSMEs Perceived as High-Risk Borrowers
- Lack of credit data makes MSMEs less attractive to lenders.
- Limited fixed assets:
- â‚ą3.18 lakh average fixed assets per MSME in 2022-23.
- â‚ą2.15 lakh average for manufacturing enterprises.
- Unsecured loans account for only 25% of total MSME credit from banks (as of March 2024).
- Private banks charge high-interest rates, increasing borrowing costs.
Implications & Way Forward
- Ecommerce adoption can help MSMEs access finance, expand markets, and improve business sustainability.
- Policymakers need to enhance awareness and ease access to government support programs.
- Financial institutions must develop better credit evaluation models to reduce MSME borrowing costs.
- Strengthening the digital ecosystem will be crucial for MSME growth in India.
