JJEM: Special Edition 4 (May 2025)
JJEM: Special Edition 4 (May 2025)
2025-05-31
A Study on Impact of Financial Inclusion on Development & Growth of MSMEs in India
Mr. Devaraju N , Dr. Prathap B N , Ms. Ashwinee G
This study aims to explore the concept of Financial Inclusion and how it is impacting the Micro, Small & Medium enterprises' (MSMEs) in its development and growth in India. This study also highlights the major improvements that are made to the Ministry of MSMEs over the years to enable the smooth functioning of this sector through various web portals to encourage and ensure ease of access to various services provided online. This study takes into account the schemes launched by the Indian Government under the MSME-D Act 2006, which are majorly contributing to the growth of these MSMEs by way of disbursing fundsto various sub-sectors in order to develop andalso enhance the overall growth rates in the number of units assisted and employment generatedthereof. This study, in a snapshot has revealed the advancements made in these sectors to enable financial inclusion and their performance over the last five years to project the current trend and has used correlation analysis to know the degree of relationship between the growth rates in amount of funds disbursed and the growth of MSMEs. It suggests insights to improve the conditions of MSMEs. The data-analysis is exclusively done based on the secondary sources of data collected from articles, textbooks, journals, websites, annual reports of MSMEs &published press releases made by the Government officially via the Press Information Bureau. A uniform and robust system has to be adopted to ensure the revaluation of the data extracted and published in the reports for producing reliably accurate information. It is suggested that the Ministry must focus more on efficient budgeting and allocation of funds to reduce stagnation or underutilization of the funds across the sector andthey enable them to be utilized optimally.
MSMEs, Financial Inclusion, Economic Growth, Government schemes, Entrepreneurship development