Digital economy: Make digital highway attractive for MSMEs

The global spend for digital technologies is slated to touch $6 trillion by 2024 as per an IDC report. In India, several large businesses have been investing in digital technologies and have started realising the benefits of digital transformation as evidenced in banking, insurance, manufacturing and retail sectors. The ongoing digital led successes of these businesses from customer facing or operations domains are leading them to undertake digital transformation initiatives in other facets of business too. Yet, we have a significant distance to cover in the global digital competitiveness, with India being placed 48th among 63 nations.

One of the key stakeholders who would contribute to digital competitiveness – the MSMEs— have been slow to adopt digital technologies. For India’s aspiration to become a $5 trillion economy, MSMEs will have a significant role to play and adoption of digital technologies would be the corner stone for this roadmap. It is also true that the risks involved with digital initiatives are also high with 60-80% of them failing to deliver on the expectations of digital transformation. Not only is the risk appetite low with the MSMEs, they also need help with risk analysis and minimise the potential failures even though their investments would be much smaller. Therefore, in order to make the MSME sector vibrant we need a multi pronged approach for digital transformation.