60% of MSMEs plan to digitize their business by 2025: Vi report
Kolkata: Almost 60% of MSMEs plan to digitize their business processes by 2025, according to Vi Business ReadyforNext MSME growth insights study.
A significant 43% of MSMEs plan to increase their overall digitalisation budget by 2025.
Sectors with lower Digital Maturity Index (DMI) are particularly inclined to increase their investments reflecting a growing commitment towards digital transformation, according to the study.
The top three sectors that emerged as most digitally matured are IT-ITES, Financial services and Transportation. While these lead in digital maturity, sectors like Retail and Construction are also making significant strides.
Involvement of Senior Leadership or CEOs results in more comprehensive Digital transformation. Success rates of Digitalization were higher when championed by the Senior Leadership and CEOs, the study noted.
Despite challenges like knowledge gaps and financial constraints, MSMEs are increasingly using technologies like cloud computing, IoT, and advanced workspace tools to boost productivity, collaboration, & market reach.
The study revealed 40% of MSMEs from IT & ITeS, Retail and Construction have adopted IoT Solutions in Business.
During the pandemic, while MSMEs prioritized digitalizing their workspaces, in 2024, the focus has moved on to engaging with their customers digitally.
The study recommends MSMEs to focus on digital security, and digitally engaging with both customers (customer service) and prospects (customer engagement), indicating emerging need to focus on digital strategies to meet evolving customer expectations.
Digitalization has a direct positive correlation with turnover, the study found. Further, as the firm size increases, the variation in digital maturity level narrows indicating that medium to large firms have embraced digitalization and there is scattered digital adoption among micro and small firms, it added.
Growing need of data security and data privacy solutions as 43% of MSMEs are currently using device security technologies, data and device protection.
Furthermore, MSMEs with turnover of less than Rs 10 crore are using public cloud while those in higher turnover bracket of Rs 10 to 100 crore use private cloud, indicating the need for greater data security and privacy with the increased turnover of MSME, according to the study.
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