MSMEs aka Micro, Small, and Medium Enterprises are believed by many to be the backbone of India’s economy. One look at recent stats, immediately clear up any doubt you may have as to why this is the case. Nearly 8% of India’s GDP is contributed by MSMEs. Furthermore, they can also be held responsible for 45% of the country’s manufacturing output and 40% of India’s exports.
Suffice to say, MSMEs play a fundamental role in shaping India’s economy. As leading MSME loan providers in India, we at Findestination know exactly how integral MSMEs are to India’s economic growth. As such, we would like to use our insight as industry insiders to shed some light on this topic for the benefit of both casual folks and aspiring entrepreneurs seeking MSME loans.
So without wasting any more time, let’s get started.

What are MSMEs?

As mentioned before, MSME stands for Micro, Small, and Medium Enterprises. According to the MSMED Act of 2006 introduced by the government of India, MSMEs refer to enterprises that engage in the act of producing, processing, and persevering goods and commodities.

Following are some essential elements that characterize an MSME

  • MSMEs are known to offer credit limits and funding support to banks.
  • They promote entrepreneurship.
  • By offering employment, loans, and other services, MSMEs contribute to the welfare of workers and artisans.
  • They support the upgrading of skills by launching specialized training centres.
  • They also support the constant development of information, infrastructure, and developmental technology.
  • They work to improve access to both domestic and export markets.
  • They offer quality certification and modern testing services.
  • MSMEs currently support design innovation, product development, and packaging.
The Role MSMEs Play for the Indian Economy

Ever since their introduction, MSMEs have proved themselves to be a highly productive segment of the Indian economy. These enterprises produce a wide range of products and services for both domestic and international markets. Today, many economists hold MSMEs responsible for the development of India’s coir, village and khadi industries.

Over the years, these enterprises have worked hand-in-hand with state governments and concerned ministries for the welfare of India’s rural population. They are responsible for the industrialization as well as the socio-economic development of these areas… and they did so at a relatively lower capital cost than larger industries.

Moreover, MSMEs have also been instrumental in the development of our country in several other aspects as well. For instance, they are responsible for boosting domestic production, lowering rates of imports, achieving flexibility in operations, and offering employment opportunities to the rural population.

How important are MSMEs for India’s Perpetually Growing Economy

MSMEs are fundamental for India to promote equitable development and accomplish consistent economic growth. Many foreign developed nations hail MSMEs for their thriving economy. These enterprises can and are doing the same for India as well.

Today, MSMEs employ around 120 million people across the country, thus becoming the second-largest generator of employment in the country after agriculture. MSMEs are expected to increase their contribution to the country’s GDP by up to 50% by 2025. This alongside MSMEs’ requirement for low investment, flexible operations, and the ability to rapidly develop native tech is taking India’s prosperity to a new height.

MSMEs very well might be the ace in the hole India needs to eventually achieve its goal of becoming a $5 trillion economy.

How Findestination Helps MSMEs Grow

You now know how important a small business is for the prosperity of India’s economy. However, running a small or medium enterprise is not child’s play. You need proper planning and informed financial guidance to have a chance at succeeding in today’s cut-throat market environment. Fortunately, you don’t have to look any further than Findestination for some expert financial advice that provides your business with the push it needs to scale and thrive.
As one of the best MSME loan consultants in India, we offer MSME loans and tailor-made financial solutions to small and medium enterprises across the country. Over the years, we’ve helped hundreds of MSMEs navigate through the unforgiving terrain of today’s market to accomplish their goals. Rest assured, we can do the same for your enterprise as well.
Get in touch with us today to learn more.