What is the scenario for MSME Financing Worldwide and India?
What is the scenario for MSME Financing Worldwide and India?
MSME are alone responsible for 50% of employment creation across the globe especially in emerging economies. As per current projections of population growth, nearly 0.6 billion new jobs would be required to absorb the working population and keep economies growing. To grow at such a rate, the common issues faced by MSMEs is access to capital as there is an unmet need of $5.2 trillion every year in developing countries.
Talking about India, disbursing loans to the MSME is crucial to reach a $5 trillion economy in future. Recently, there has been a massive growth of 18% in the last two years (INR 31Lac Cr to 36.4Lac Cr) with a share of 88% demand coming from the micro segment followed by 10% from Small and 2% from medium enterprises. As compared to traditional ways to access the loan/financing, these days the process can be done via online mode which reduces turnaround time to get access to funds with increase in convenience, less visit to lender’s office and lower interest rates.