India’s young business owners have acknowledged the growth and beneficial impact of adopting digital technology on both their businesses and personal lives. According to PayNearby, a branchless banking and digital network, 75% of the Micro, Small, and Medium Enterprises (MSMEs) owners aged 18-30 were most digitally adeptin the country. And over 87% of this age group were using smartphones for daily business operations and accessing digital content.
As per PayNearby, 65% of the MSME owners utilise some form of digital technology for their daily operations. As many as 68% of MSMEs acknowledged the growth and beneficial impact of adopting digital technology on both their businesses and personal lives.
“The MSME Digital Index 2024 showcases significant progress in technology adoption while highlighting persistent challenges. We believe that MSMEs should be supported in their digital transformation journey and ensure that technology’s benefits reach every corner. By leveraging artificial intelligence (AI), augmented reality (AR), and machine learning (ML), MSMEs in rural India can thrive in a digital-first economy. We must foster an inclusive ecosystem that enhances skills and removes barriers, enabling all businesses to embrace digitalization,” Anand Kumar Bajaj, Founder, MD & CEO, PayNearby said.
The use of digital devices was primarily for work purposes, with 36% spending 4-6 hours on their phones. However, when it came to leisure activities such as social media or online entertainment, the report noted that 66% spent less than 3 hours. Among apps, YouTube emerged as the most preferred for both social media (41%) and entertainment (72%). Interestingly, 58% of respondents stated that they did not have any gaming apps installed on their phones.
Further, the report mentioned that over 51% of these businesses spend less than Rs 500 per month on internet usage. The report stated that among all tech-savvy MSMEs, a majority of 29% used accounting software, followed by POS software and Customer Relationship Management (CRM) software at 17% and 14%, respectively, to manage their business operations. Meanwhile, 6% indicated they do not use any software and instead rely on manual methods.
41% of the MSMEs are using digital devices to streamline financial transactions and efficiently track business expenses, while 18% stated that technology was used to accelerate processes.
In the financial services category, UPI at 43% and Aadhaar banking at 38% were the two most popular banking services used by MSMEs at the last mile. Additionally, WhatsApp and WhatsApp Business were collectively the most widely used messaging apps, with a usage rate of 97%.
Jayatri Dasgupta, CMO of PayNearby, said, “This comprehensive report underscores the importance of digital literacy and infrastructure in empowering MSMEs. Our findings show a promising trend of increasing tech adoption, but also point out the areas that require more focus and investment”.