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Challenges faced by MSMEs-

  • Categories
    Yojana/Kurukshetra
  • Published
    15th Nov, 2019
  • The sector is always fund starved. Banks are often unwilling to lend. Besides, whatever bank finance these sector gets, comes at far higher interest costs than what large enterprises can negotitate.
  • Little access to trained labour, technical progress and management support limit their growth.
  • Lack of awareness in access to finance and marketing, adoption of innovative technologies are the major challenges.
  • 90% of the MSMEs are dependent on informal sources for funding thus, there is lack of sufficient collateral and high working capital needs.
  • There is inadequate access to quality raw materials. Also, use of traditional machines causes low productivity.
  • Cumbersome government procedures and rules for establishing new units and bureaucratic delays in getting clearances.
  • Other common problems faced by small enterprises are related to availability of technology, infrastructure and managerial competence, and limitations posed by labour laws, taxation policy, market uncertainty and imperfect competition.
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