Leading SMEs of India 2023

Leading SMEs of India 2023 | 55 [ INDIAN SME SECTOR OVERVIEW ] CHALLENGES FACED BY INDIAN MSMEs INADEQUATE INFRASTRUCTURE A proper infrastructure base is a pre-requisite for the success of any business. MSMEs in hinterlands often struggle with unreliable utilities such as power, water as well as infrastructure constraints of road, rail and port connectivity which reduces business efficiencies and competitiveness. SLOW PACE OF TECHNOLOGICAL ADOPTION In the current hyper-digital era, adoption of new age technology is imperat ive for the survival and growth of businesses and key to unlock the true business potential. However, despite the rapid adoption of technology across sectors by large enterprises, MSMEs has been a late adopter. While theadoptionof smart phones and the internet has increased significantly in rural areas, the majority of MSMEs still lack use of new-age digital technologies like Artificial Intelligence (AI), Machine Learning (ML), Software as a service (SaaS), and Internet of Things (IoT). Lack of awareness about these latest technologies, inadequate technology skills, and the use of age-old technologies prevent the micro & small enterprises from competing with their medium/ large counterparts. FINANCING GAP Access to low-cost credi t i s necessary for MSMEs at every stage of their business. Micro and women’s enterprises lack awareness of var ious MSME loan schemes launched by the government. Lack of awareness, along with the inability to provide requireddocuments and collateral, often leads MSME businesses to source finance from other non- institutional avenues like relatives, friends, and privatemoney lenders at exorbitant interest rates. The lack of affordable and timely credit facilities adversely impacts the growth of MSMEs. AVAILABILITY AND RETAINING OF SKILLED TALENT Finding and retaining ski l led employees is becoming among top challenge for SMEs in India especially in absence of proper t r a i n i ng and deve l opmen t initiatives. In India, 51% of MSMEs are based in rural areas and are largely dependent on local workforce which is not adequately sk i l l ed . Lack o f awa r enes s about training and mentoring opportunities (skill development initiatives of the government), high costs involved in sourcing and retaining of the talent acts as a major roadblock in the development of MSME businesses. Dun & Bradstreet