By Akash Gehani
Technology for MSMEs: Over 6.33 billion businesses make up India’s MSME sector, employing over 11 billion people. Nearly 30% of the country’s nominal GDP comes from this industry, which has grown at a CAGR of 18.5%. The work does not stop at MSMEs who create digital assets such as the e-commerce website, set up banking and payments, and perform online transactions. After the initial setup, they need to make sure their digital assets are protected against cyberattacks. This can be a technical and difficult process. MSMEs need to increase their understanding of cybersecurity, its implications and its integration. To remain globally competitive, MSMEs need to effectively strengthen their cybersecurity procedures.
With the need to comply with India’s Computer Emergency Response Team (CERT-In) new cybersecurity regulations, MSMEs must report security incidents within six hours of detection. They require virtual private network (VPN) companies to track user data and turn it over to authorities upon request. Indian MSMEs have requested additional time to comply with the new regulations as they are not equipped for such rapid change given the challenges of technology integration, especially for nano and small businesses. The majority of problems faced by MSMEs can be attributed to a lack of resources and technological expertise.
Small businesses are thought to face a variety of consequences from cyberattacks, including financial, psychological and emotional, adding to the risks they were already assuming when they started doing business online. Small businesses are frequently targeted by phishing, ransomware, password theft, man-in-the-middle attacks, denial of service attacks, DNS attacks, and advanced persistent threats (APT). Acquiring knowledge, maintaining hardware, using smart passwords, and frequently updating and inspecting systems are some strategies to protect a business against cyberattacks.
MSMEs also often face capital constraints due to limited access to finance. As a result, the technological base is fragile, which results in poor quality production. Because of this loop, people are afraid to learn digital technologies. Without experienced and tech-savvy employees, a business will not be able to apply solid digital marketing concepts to achieve profitable results.
These factors complicate the development, expansion and awareness of MSMEs. People who oppose technology and are reluctant to spend more money on more expensive but useful digital equipment often don’t know how to use it or what its benefits are.
You have to constantly update your products and keep up with the trends to increase sales in the digital market. For this, innovation is crucial because we are all looking for something that will make us stand out. Technologies such as AI/ML, IoT, and data intelligence, which can help small businesses provide better customer experiences and establish an online presence, can greatly benefit them. These digital technologies make it easy for small businesses to compete with big business leaders.
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The Ministry of MSMEs offers programs and learning plans to help MSMEs adapt to changing digital technologies. Moreover, one can take apprenticeship programs with government and private providers and also register on the Udyam website to know more about the beneficial policies provided by the government. In the recent past, we see that traditional businesses are open and honing in on using digital technology as they become more aware of its benefits. Among the steps that will help MSMEs and DTCs, here are the key things the government should focus on to support these businesses:
Convenience of online and offline font sales
According to industry statistics, the MSME sector contracted by 46% during the first Covid-19 lockdown in 2020 and losses totaled 11% during the second lockdown. Government measures to halt similar losses in the future will help the survival and expansion of MSMEs in India. Small DTC owners will be more independent and responsible for their business operations thanks to a strategic and comprehensive framework to support e-commerce for SMEs. Even trading income will increase accordingly in the same way.
Boosting global e-commerce prospects for SMEs
The smaller DTC brands have few marketing options outside of India. The traditional method is just as laborious and difficult. To encourage e-commerce for SMEs, the government should design comprehensive foreign trade coverage. Smaller DTC companies will find it easier to enter new markets by reducing compliance requirements and relaxing tactics. It will even help Indian products gain greater international exposure.
Provide SMEs with digital training
Beyond Tier 1 procurement, the government needs to step up capacity building and training initiatives. It is becoming increasingly clear that technology will be key in determining the success and competitiveness of Indian MSMEs both domestically and internationally in the coming years. Business transformation in 2022 will be driven by technologies such as Fintech APIs, comprehensive data platforms, specialized machine learning solutions and advertising optimization. The digitization of MSMEs should therefore be considered a priority.
Develop infrastructure and logistics related to e-commerce
MSMEs will now benefit from new additions to a massive infrastructure project announced in the Union budget for 2022. Prime Minister Gati Shakti’s master plan will now help facilitate the movement of goods and passengers, especially in the regions rural areas, and will contribute to improving modal interconnec- tivity. These guidelines were necessary to ensure that more SMEs could participate in online sales. Small DTC businesses will have a nurturing base through improved delivery and infrastructure as well as the necessary virtual skills.
With structured e-commerce shipping and courier partners, consumers could buy and sell online even in remote parts of the country as the infrastructure expands. For most MSMEs in India, e-commerce has been an opportunity rather than a challenge. And in the years to come, this trend is expected to accelerate.
Also read: GeM: Public procurement crosses Rs 3 lakh crore; double in 12 months
Akash Gehani is the co-founder and COO of Instamojo. The opinions expressed are those of the author.