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MSMEs in India have adopted digital platforms in their business, but now they will have to harness AI and GenAI technologies to remain relevant, says IndiaMART InterMESH COO.
The micro, small, and medium enterprises (MSMEs) in India have increasingly incorporated technology into their businesses, with the majority now considered digitally savvy. They have implemented technology in areas such as payments, customer service, and integration with online marketplaces. However, much more needs to be done as they continue to face challenges such as the high cost of technology products and services, low awareness of various digital tools and uncertainty about the return of investment.
In today’s fast-changing world of technology, and with the advent of artificial intelligence (AI) as well as generative AI (GenAI), it has become more important than ever for MSMEs to keep pace with these changes. AI is expected to deliver even deeper benefits for businesses, and MSMEs cannot be left behind.
IndiaMART InterMESH Limited, one of the leading B2B marketplaces in the country, has been closely connected with the MSME ecosystem, supporting their digitisation journey and showcasing new ways of doing business.
In an e-mail interview with SMB Story on the technology change of MSMEs, Dinesh Gulati, Chief Operating Officer of the company, said, “The move towards being digital-first has already started, but there is a long way to become data-intelligent.”
Edited excerpts.
SMB Story: What is IndiaMART’s view on digital adoption trends among MSMEs in India?
Dinesh Gulati (DG): The Indian MSME sector boasts over 6.3 crore enterprises, and close to 67% of them are now digitally ready, reflecting a strong shift in the mindset. This is not just restricted to metro cities anymore. Tier II and smaller cities have shown significant progress in adopting digital tools. This transformation is being driven by widespread smartphone penetration, improved internet connectivity, digital payments like UPI and digital wallets, and the huge tailwind created during the pandemic. Digital adoption has become a need for MSMEs. Many MSMEs are taking advantage of online marketplaces like IndiaMART and many more.
The move towards being digital-first has already started, but there is a long way to go to become data-intelligent. This includes using data-led insights for better customer experience (CX), logistics, and internal operations, followed by deeper integration of AI/ML within the systems.
As tech advancements continue, the MSME ecosystem will also adapt in the same way it is embracing basic digital tools now. It is, indeed, a very innovative time to be a small business.
SMB Story: What are the key challenges MSMEs face when they begin their digital journey?
DG: The benefits of digital adoption are well understood in today’s time. However, MSMEs continue to face some roadblocks in embracing the digital-first options in their early stages. This includes limited digital literacy, minimal exposure to online platforms, and concerns about fraud or unclear returns on investment. A PayNearby report stated that 36% of MSMEs showcase resistance to adopting new technology, while 18% struggled with the high costs of implementation. This thought process is now changing, as businesses see ROI in using basic digital tools such as WhatsApp for Business, the use of marketplaces to develop a digital footprint, accounting tools such as Busy or Livekeeping, and many more.
Another line of concern revolves around limited knowledge of digital tools and a lack of technological know-how in implementing them. We at IndiaMART connect with more than 15 lacs every year to explain the advantage of going digital and provide the required handholding in initial stages.
In addition to that, multiple initiatives are being run by government and private entities now that help in the basic digitisation of the business.
SMB Story: How is IndiaMART enabling the digitisation of MSMEs, especially those located in Tier II and beyond?
DG: Geographical barriers should never restrict one from maximising their business, and that’s what we believe at IndiaMART. The advent of ecommerce has tried to create a level playing field to businesses, despite their base locations. We at IndiaMART have been committed to making doing business easy for businesses, by offering a series of tech-driven innovative solutions to enable and empower MSMEs.
Our platform is built to offer both simplicity and scalability. With over 8.4 million active suppliers on the platform, we provide user-friendly tools that enable businesses to easily set up digital storefronts, aggregate leads, connect with buyers and through in-built lead manager( LMS) , they are able to efficiently manage the leads. And all these solutions are available to businesses nationwide, across all tiers of cities in a plug & play mode. Our mobile-first approach, multilingual support, and dedicated customer assistance ensure that businesses can confidently embrace digital solutions, regardless of their location or digital proficiency.
SMB Story: What benefits have MSMEs observed after onboarding onto IndiaMART’s digital platform?
DG: An increase in visibility and access to a larger network of potential buyers is one of the major reasons businesses register with us. However, they continue to stay with us because of multiple other offerings such as a professionally designed catalogue to showcase their products or services, efficient management of buyer inquiries in a single place, access to markets beyond the local geography, and receiving a fixed number of business enquiries based on their paid subscription.
Beyond lead generation, IndiaMART offers tools for catalogue management, customer communication, and secure transactions to help businesses streamline their operations and improve responsiveness. Besides getting a vast variety and the best prices with ease and convenience, IndiaMART offers huge trust between buyers and sellers.
Our AI-enabled conversation commerce has not only helped businesses in streamlining transactions but also reinforced the trust in B2B commerce. For many MSMEs, having a strong digital presence not only opens up new business opportunities but also builds greater credibility and trust with their customers
SMB Story: What are IndiaMART’s plans to drive the digital agenda for MSMEs in India?
DG: We will remain committed to empowering MSMEs by making technology more accessible and impactful. We have already introduced several innovations such as AI-driven lead matching, image-based product search, and integrated payment solutions that simplify business transactions.
Moving forward, we plan to further expand into areas like conversational commerce, credit facilitation, and logistics partnerships to offer a more seamless, end-to-end experience for our sellers.
Additionally, we are leveraging Generative AI and Agentic AI to fine-tune our offerings, creating efficiency and accuracy at scale. Our larger vision is to create an ecosystem where every MSME, regardless of size or location, can access the tools, resources, and support they need to succeed in a digital-first economy.
Online Coverage: SMB Story