18 Jan 2019, 09:54 — 4 min read
The year 2019 has started on a positive note for SMEs across India.
The recent announcement that the GST Council is further easing the compliance requirements for SMEs will come as good news for the sector, which is acknowledged as the growth engine of the Indian economy. There is a collective sigh of relief now that Finance Minister Arun Jaitley has raised the sales threshold for GST registration from Rs 20 lakh to Rs 40 lakh. This is just one in a series of initiatives unveiled by the government aimed at easing the constraints faced by SMEs. It is not surprising then that 2019 is poised to be an interesting year for the SME fraternity. Let’s look at some of the trends that will drive the sector this year
Increase in mass-scale digitisation
Whilst SMEs really began to see value in the power of digital in the past years, 2019 will be the year that will witness greater digital adoption. SMEs will now start to realise the value of digital tools for business to help with e-commerce, payments, finance as well as targeted services such as HR and logistics.
Increased networking opportunities
The trend of SMEs working together for mutual benefit will grow in this year. This would include buying from and selling to each other and participation in various fora. Digital networking will also become increasingly popular, offering SMEs a multitude of benefits that include improved business opportunities, knowledge sharing and embarking upon global partnerships for cross-border trade amongst others.
Ease in securing working capital
SMEs will find it easier than ever to secure funds with recent government initiatives that are stacked in their favour. This includes the endeavour to approve loans online in 59 minutes. Leading banks and non-banking companies are looking at new and innovative means to better assess SMEs for their borrowing needs. They are now upping the ante when it comes to making services and products relevant to an SME audience. More importantly, the intent is not just to tap the vast and untapped market, but also about investing in meaningful engagement and value addition to the SME community.
Expansion of businesses beyond local boundaries
SMEs find it difficult to think beyond local because of a lot of barriers to do trade internationally and to grow the business. New-age digital enablers have eased the way for sellers and buyers who were earlier challenged by their geography to now do business seamlessly. An increasing number of SMEs will look at growing their numbers from an exports perspective. Those in the fields of gems and jewellery, textiles, chemicals and base metals will likely benefit the most.
The power of the mobile
India currently has 300 million smartphone users. This has created a large opportunity for SMEs, who will start to increasingly see the merits in incorporating m-commerce or to capture customers through a mobile platform. Due to the affordability and ubiquity of smartphones, small retailers are likely to adopt mobile more for their daily transactions as they don’t need an intricate set-up for it.
Investment in cyber-security
Cyber security needs and measures have become a reality for SMEs and securing their digital assets will become a key consideration in 2019. There will be an increase when it comes to investing in hybrid security systems and the use of cloud-based detection and response solutions to combat these cyber threats.
A lot of new avenues are opening up for SMEs in 2019, thus ensuring that just maybe this year will prove to be promising and hopeful for India’s 60 million strong SME community.
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Sameer Vakil has written this article for IANS
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