Micro, Small and Medium Enterprises are the backbone of the nation, and the COVID-19 pandemic has hit their reserves and led to an economic downfall for these small businesses, alongside the economic stress seen in the entirety of the country.Helping MSMEs sail through these challenging times is essential for the growth and sustainability of the country’s economy.The government has offered help to these small businesses by announcing a Rs 3.75 lakh crore stimulus package. A provision to funnel nearly 20,000 crores through the Credit Guarantee Fund Trust For Micro And Small Enterprises is also a welcome move.
However, these organizations require support from all spheres of the business community. While backing is being offered by the government in terms of financial aid and grants, private and non-profit organizations can bring in their manpower and better expertise to help out MSMEs.
Most of the MSMEs in the country are in dire need of consultation in regards to their businesses and their reach to customers.Even when they delve into the stimulus being provided by the government, usage of these funds to rectify their broken ecosystems would require prompt feedback from business consultancies skilled in this area. Support from business consultancies would be beneficial for using the funds that have been provided to build plans to address the challenges that MSMEs have faced while dealing with the increased distance that has crept in with their customers, owing to lockdowns and many of their clients preferring to stay home. These firms, who have had very less exposure to online selling and the world of digital marketing would benefit immensely from exposure to quality business consulting. Business consultation provided by private firms can also help fix broken supply chains that were disrupted and will also help resurrect internal processes, including cash management and employee retention that was affected due to the advent of the COVID-19 pandemic.
Private players can bring in the use of technology to help these small businesses to scale their impact and also function to facilitate data crunching, monitoring, and evaluation of their outputs and outcomes. The creation of AI-enabled mobile platforms and applications to create new jobs and linking the same with these MSMEs that are looking for manpower can contribute to bringing back jobs to the market and will create a dominant effect in helping these firms. Grants from NGOs and the big tech firms of the nation to enable the birth of new-gen start-ups would also be something that can be done to supplement the struggling MSME ecosystem.
Private banks can take measures to increase liquidity in the system with things like a moratorium on term loans, reduced interest rates, easing of working by private banks, and others in the lending sector. Such measures would shorten the financial burden of MSMEs that are struggling with the procurement of loans and are in dire need of financial protection.
A successful public-private partnership is the need of the hour, for MSMEs to get back on their feet. The government has done its part with the limited resources at their disposal. Now, it is time for the biggest private players in the country to ensure that MSMEs that feed the mouths of the middle-class don’t go down the drain.