As the majority of Indian micro, small and medium enterprises (MSMEs) continue to face debt and delayed payments, about 90 per cent are confident about India’s economy In 2024, according to a study by NeoGrowth, an MSME-focused non-banking financial company (NBFC).
The MSME business confidence Study revealed that about 91 per cent of MSMEs expect their profits to increase and 82 per cent are planning to harness the power of online tools in 2024. It added that over 40 per cent of MSMEs benefitted from government schemes in 2023, with Manufacturing and wholesale MSMEs being the top beneficiaries
Arun Nayyar, Managing Director and Chief Executive Officer (CEO), NeoGrowth said, “Similar to 2023, MSMEs have continued to radiate optimism in India’s business environment. From steady growth in profits to expansion plans, their confidence portrays a vibrant picture of prospects for the country’s economic growth in 2024. India’s small businesses will continue to take centre-stage in India’s growth story.”
Optimism For India’s Economy In 2024
MSMEs in the wholesale/trading sector are leading the charge on economic optimism, with a resounding 95 per cent expressing confidence in India’s robust growth trajectory for 2024. Supportive government policies and regulations coupled with robust domestic and global demand further fuel this sector’s unwavering optimism.
Retail MSMEs are very optimistic as 94 per cent of MSME retailers expect an increase in profits in 2024. Also, 58 per cent of MSMEs in the trading/wholesale segment expect their profits to increase by over 30 per cent.
Talking about consumer demand in 2024, the study revealed that 75 per cent of wholesale and trader segment MSMEs remain bullish on consumer demand in 2024, echoing the optimism expressed in 2023. Concerning locations, Delhi is most optimistic where a whopping 87% of surveyed MSMEs anticipate a surge in consumer spending. Bangalore and Pune follow suit with impressive levels of confidence.
Strong Credit Requirement To Continue In 2024
Nearly 60 per cent of businesses across all sectors anticipate the need for credit in 2024. The wholesale/trading and Services sectors anticipate the highest demand, with a whopping 64 per cent of businesses seeking credit to boost their operations. Notably, the appetite for loans seems strongest in metropolitan hubs such as Bangalore (88 per cent), Pune (87 per cent) and Delhi (84 per cent).
The top three factors for consideration while choosing a loan provider in 2024 would be quick disbursals, digitally enabled loan journey, and deal terms.
The highest number of MSMEs in Delhi would choose a lender with a digital loan process, whereas MSMEs in Pune prefer loan providers with fast approvals and disbursals.
