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43% Indian MSMEs to increase digitalisation budget
Industry News- Jun 29,24
Vi has launched an enhanced Digital Assessment Tool, both in English and Hindi as an extension of its dedicated MSME program.
Despite challenges such as knowledge gaps and financial constraints, MSMEs are increasingly adopting digital technologies like cloud computing, the Internet of Things (IoT), and advanced workspace tools to enhance productivity, according to a study. The study noted that 40% of MSMEs in the IT & ITeS, retail, and construction sectors have integrated IoT solutions into their operations.
The study by Vodafone Idea’s enterprise arm, Vi Business, revealed that 43% of micro, small, and medium enterprises (MSMEs) in India plan to increase their digitalisation budget by 2025. Meanwhile, 28% aim to maintain their current budget, and only 21% anticipate a decrease.
"Sectors with lower Digital Maturity Index (DMI) are particularly inclined to increase their investments, reflecting a growing commitment towards digital transformation," stated Vi Business in its study findings released on World MSME Day.
According to the DMI metric, the top three most digitally mature sectors are Information Technology/IT-enabled Services (63.3), financial services (62.3), and transportation (61.4), with retail and construction sectors also making significant progress. In contrast, the telecom sector, referring to MSMEs involved in manufacturing telecom and networking products, ranked lowest with a DMI score of 54.8.
The study highlighted that increased digitalisation positively correlates with turnover. As firms grow in size, the variation in digital maturity levels decreases, indicating that medium to large firms have broadly adopted digitalisation, whereas micro and small firms show scattered adoption.
For FY2025, MSMEs are prioritising digitalising business processes (59%) over workspace (29%) and customer engagement (12%), with over 50% planning to increase their digitalisation budget, according to Vi Business.
Arvind Nevatia, Chief Enterprise Business Officer, Vodafone Idea, emphasised that the extensive study showcases the progress of small businesses in India and the challenges they face in digital transformation. He noted that the study, possibly India’s largest MSME digital assessment, offers valuable insights for these organizations' future strategies.
Additionally, the company has launched an enhanced Digital Assessment Tool in both English and Hindi, as part of its dedicated MSME program.
The findings are based on a survey of 160,000 MSMEs across 16 industries in India, including IT & ITeS, construction, transportation, media & entertainment, mining, retail, financial sectors, agriculture, professional services, education, tourism & hospitality, and healthcare.
(Source: ET)
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