SMEs Are Adopting New Digital Technology And Government Initiatives

After the COVID-19 pandemic situation, Small and Medium-Sized Enterprises owners try to run their enterprises more effectively and elegantly. The significant changes in SMEs business observe during a pandemic is the adoption of the digital process. Not only do entrepreneurs prefer to work from home and hold meetings online, but they also used Okcredit's digital application for creating a ledger for every transaction. Let's understand SMEs and their scope in 2021.

How do SMEs work?

Small and Medium-sized Enterprises come under the Ministry of Micro, Small, and Medium Enterprises (MSMEs). SMEs are working on specific parameters and limits that include:

Micro-enterprise can invest less than or equal to 1 crore, and turnover should be less than or equal to 5 crores.
If small enterprises can invest less than or equal to 10 crores, turnover should less than or equal to 50.
In the case of micro-enterprise can invest less than or equal to 50 crores, and turnover should be less than or equal to 250 crores.

The above limitation affects yearly sales, numbers of enterprise's assets, the number of employees, market shares to Small and Medium-sized Enterprises.

According to the Ministry of Micro, Small and Medium enterprises contribute approximately 35% of the GDP from countries' total GDP. It shows that the SME sector needs more growth to reciprocate loss to benefits.

Union budget 2020-2021 for SMEs

The union budget gave some suggestions for the future of the SMEs sector:

Government highly recommended MSMEs app-based invoice loan products. These are as follows –
MSME loan in 59 minutes
MUDRA loan
SMILE fund for MSMEs
Stand-up India
Credit Guarantee Scheme (CGS)
Revision of factory regulation Act, 2011 – Invoice financing will be the outcome of extending the MSME scheme. SMEs can use their working capital to recover small expenses.
Niryat Rin Vikas Yojana launched to reduce the higher export credit payment. One more benefit SME businesses can take with this scheme is that they do not have to pay a high premium and get hike insurance coverage in 2021.

Current Small and Medium enterprises trends in India

Over the last few years, the Indian SME trend, like a stable market, works fluently and stands confidently. According to the survey in 2019 by Okcredit, Indian Small and Medium enterprises boost 60% worldwide within five years. During the COVID-19 pandemic, many small-level entrepreneurs make things more efficient by improving transaction operation and interacting throughout the digital platform. Okstaff plays a vital role in making the financial transaction more secure and trustworthy.

Within a few years, many new entrepreneurs changed the working style of trading—the trend to use Okcredit for their online trading endurance themselves from many problems. Many SMEs are bearing the brunt of the COVID-19 pandemic.

Some points that are showing that Indian small and medium enterprises trend in 2021 -

1. Speed up the usages of the digital world:

2021 comes with the e-commerce revolution because of last year’s epidemic. SME sectors have entered the digital world with a different platform to keep connected with their clients. Okcredit application is another application that is highly used by small and Medium in 2020 to retain all transactions securely. So, the digital platform's adoption will continue in the future for contact with consumers for online sale products.

2. Initiatives of Government:

MSME business is doing well to generate employment and play a vital role in the uplifting Indian economy. The Government encourages new entrepreneurs to take advantage of initiatives like Make in India, Start-up India, and Vocal for local and get financial help from schemes like MUDRA borrowers, Emergency Credit Line Guarantee Scheme, and business loans facilities for individuals at the end of March 31, 2021. Prime Minister Narender Modi has emphasised in his speeches that Indian should use its swadeshi products and encourage small enterprises for more productivity.

3. Financial strategy:

All over the world faced massive difficulties related to health and finance aspects in 2020. It also affects the SME business because newly introduced entrepreneurs face huge losses as they invested their capital in standing their enterprises. Many huge enterprises are struggling with financial emergencies till now. In the future, it will become essential to encourage savings for an emergency. SMEs should keep an eye on their quarterly economic calculation to stabilise capital and revenue. Okcredit application can help to decrease the expense of account executive salary because you can install it from the Play Store on your Android phone.

4. Brand new marketing tools:

This digital world has many tools to evaluate and operate the SME business. Okcredit is an effective and secure tool to retain transactions between two parties and generate a ledger for every transaction. OkStaff are very alert towards the customer query. You can also customise the OkCredit application as per your requirement. After the 2020 pandemic, many people are approaching different applications and tools.

5. Business operation in a new direction in 2021:

In 2020, SMEs had faced so many problems related to financial state because they need cash liquidity in their business and always focus on instant payment. Besides it, 2021 becomes a more digital business reformation because entrepreneurs are likely to use different online platforms for meetings, auditing, and employee management. Websites and social activity have much effect to reach out to the audience and expected customers. Entrepreneurs can get rid of any economic recession with small investments, saving habits, Government initiatives, and MSME schemes playing a vital role in running a small business.

Conclusion

Small and medium enterprises faced many odds last year, but now they need to develop new skills and adopt new technology in their day-to-day tasks. In the upcoming years, the digital world will grow vastly and create new opportunities for more productive results. In the future, entrepreneurs should keep concentration on their websites and Okcredit. These tools keep things very well and give excellent outcomes.

Also Read:

1) Profitable Small Businesses Worth Starting in 2021
2) What Business Can I Start With 5 Lakhs in a Small Town?
3) Best Businesses You Can Start with No Money
4) OkCredit: Simple, Paperless & Secure solution for businesses

FAQs

Q. What type of help SMEs is needing from the Government for finance?

Ans. Although the Government is investing in many schemes, SMEs expect more from Government as a financial aspect. The expectation included - The Enterprise Capital Funds program, the Financial Ombudsman service, the enterprise finance guarantee.

Q. Is it necessary for SME lenders to get credit ratings?

Ans. No, it does not seem necessary for SMEs to get credit ratings, but SME lenders are interested in earning credit rates to get a high chance to get a loan from banks.

Q. Does the Government approve any specific bank branches for lending to the MSMEs?

Ans. The Government allowed public sector banks to open at least one specific branch in every district. Banks have the right to categorise their MSMEs banking branches for different aspects and invest 60% in SME sector money.

The initiative to credit money to SMEs as a loan can help decrease the complexity of trade. The Government also announced a credit policy for SMEs to open specific MSME in public sector banks for easy access and instant lending. The most positive thing about this process is that it will help SMEs extend their financial condition and give flexible loans to other sector lenders.

Q. What type of initiative is the Government giving for marketing help to MSMEs?

Ans. The Government provides a marketing assistance initiative by their entity, National small industries corporation limited. This scheme aims to increase the marketing diligence of MSMEs, which gives them an appropriate platform to communicate with their clients, listen to their problems, and update policies according to the scenario.

Q. What type of support the does the Government provide to SMEs for skill development?

Ans. Government performs different kinds of training programmes with the help of various institutions that create the ability to train with new technology. These training programmes concentrate on developing new opportunities to create new employment in the country. These training programmes are as follows –

Fifteen days Entrepreneurship Development Programme (EDP),
Forty days Entrepreneurship Skill Development Programme (ESDP).
Seven days Management Development Programme (MDP),
One Day Industrial Motivation Campaign (IMC) etc.

The Ministry has developed a web system to monitor the above programmes.