The Struggles of small businesses

The Impact

The COVID-19 disease has become a global threat to all. It has not only taken away the lives of people but has also ruined their livelihood. One such area which has suffered an adverse impact due to the restrictions is small businesses and enterprises. In India, about 63 million MSMEs employ more than 110 million workers.

The already striving MSMEs experienced a blow when the entire nation underwent a three-month hiatus lockdown. Their productivity declined due to low demand, causing many businessmen to shut down their businesses permanently. Many of them who had borrowed microloans were unable to repay the MFIs on time.

Around 8 million women lead small enterprises. (6th Economic Census,2014) Unfortunately, due to the less mobilization, they suffered heavy losses. This not only caused instability in the family but also broadened the socio-economic gap. Women had an additional burden of being stereotyped by the banks and other financial institutions while borrowing loans during these testing times.

Positive Approach

But saying so, this COVID-19 pandemic also brought in some new opportunities for these businesses. Digitization played a crucial role in this. Many small enterprises took to social media platforms and other modes of media to approach the customers. This has brought about a positive impact on their business, as this helped them to reach out to more customers than ever before.

The "Atmanirbhar Bharat Abhiyan" (Self Reliant Movement) and "Vocal for Local" were some of the initiatives taken up by the Prime Minister of India to motivate small entrepreneurs to become self-reliant and increase efficiency. The online business has been proven beneficial for many as this resulted in less paperwork, as well as, easy money transactions. This way their work has become famous to people globally.

Even though India is grappling with a severe health crisis, many are hopeful that the MSMEs would bounce back and emerge stronger. The Micro finance Institution of India is supporting small enterprises to get back on track. It is time to upgrade our policies and, come up with a solution to make up for the loss that these small businesses suffered during the pandemic. At the moment, a collaborative effort is all that is required from both, government as well as small entrepreneurs to uplift the latter's situation.