Business EconomyPosted at: May 13 2025 8:19PM


MSMEs merchandise export share increased to 45.7 pc in FY24: SIDBI report

Hyderabad, May 13 (UNI) MSMEs increased their merchandise export share from 43.6 percent (FY23) to 45.7% (FY24) said Small Industries Development Bank of India (SIDBI) in its new report titled ‘Understanding Indian MSME Sector: Progress and Challenges’ released on Tuesday.
The report showcased growth, opportunities, and persistent challenges within the MSME ecosystem.
Based on a survey of over 2,000 MSMEs across 19 sectors, the report sheds light on key themes such as credit access, women entrepreneurship, sustainability, and regional trends.
The survey offers a deeper understanding of ground-level trends in the MSME sector and highlights the sector's growth, challenges, and opportunities.
In particular, the report provides insights into women entrepreneurship and sustainability initiatives, aligning with the Government’s focus on these areas. The study also offers an estimate of the credit gap in the MSME sector.
The MSME sector, especially micro and small enterprises, has seen significant formalization through Udyam Registration and Udyam Assist Portal, with over 6.2 crore registrations by March 2025 (up from 2.5 crore in March 2024), the report revealed.
The survey respondents consider timely and adequate credit access as one of their key challenges despite the comprehensive policy initiatives in that regard.
While borrowings from informal sources are minimal for small and medium enterprises at 3 per cent and 2 percent respectively, it is still relatively significant at 12 per cent for micro enterprises.
With 18 per cent of MSMEs using digital lending platforms and 90 per cent accepting digital payments, the sector shows promising digital adoption. This trend, supported by platforms like UPI, can enhance credit access going forward, it said.
The study broadly estimated that the sector still has an addressable credit gap of about 24 percent or ₹30 lakh crore. The gap is higher in the services sector at 27 per cent; it is estimated to be also higher at 35 percent for women owned MSMEs, indicating a need for targeted policy actions.
Women entrepreneurship has become a significant aspect in the MSME sector with 26.2 percent in proprietary enterprises being owned by women as per ASUSE 2023-24, signalling growing inclusivity, the report stated.
76 per cent of the women led MSME respondents have access to credit, but they continue to face higher challenges vis-à-vis their male counterparts with 41 percent highlighting credit access and high competition as the largest obstacle to their growth, the report revealed.
According to the survey, a majority of the MSMEs have been slow to adopt modern channels to reach customers. Around 70 percent of the survey respondents continue to use traditional modes of marketing which hinders their scalability and ability to remain competitive.
Effective utilization of e-commerce and digital marketing can provide MSMEs with improved access to new markets and customers, it said.
Around a fourth of the surveyed MSMEs cite the lack of skilled manpower as one of their major challenges. Skilled labour shortages are particularly high in defence equipment, readymade garments, hotel sectors, tiles and sanitaryware as reflected in the survey.
Inadequate infrastructure and technology adoption affect productivity and competitiveness, the report said that a significant proportion of the respondents cited technology adoption as a major obstacle to their growth.
Over one-third of MSMEs have adopted sustainable practices; 31 percent use energy-efficient systems, and 21 percent utilize renewable energy. However, 33 per c ent cite limited awareness as a key barrier to further adoption, the report added.’
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