MSME Funding: Vijay Shekhar Sharma on Why MSMEs Are the Future of Indian Business

Vijay Shekhar Sharma on the Future of MSMEs

Vijay Shekhar Sharma, founder of Paytm and one of India’s most influential entrepreneurs, believes that MSMEs are India’s silent unicorns. He states, “India’s growth story doesn’t belong to just venture-backed startups. It belongs to the kirana store owner building digitally, the manufacturer going global from Meerut, and the service provider scaling from Surat. MSMEs are India’s silent unicorns.”

But what’s driving this shift in MSME funding? Let’s break it down:

• Fintech and Digital Payments: With the rise of fintech, QR payments, and digital banking, MSMEs are now more visible and trackable than ever before.
• Digital Documentation: Udyam registration and GST integration have formalized millions of small businesses, making them more eligible for funding.
• Resilience During COVID-19: MSMEs showed remarkable resilience during the pandemic, which has further garnered investor confidence.
• Tier-2 & Tier-3 Towns: The rise of local MSMEs in cities like Meerut, Surat, and Bhopal is reshaping India’s business landscape.
• Investor Focus: Today, investors are focusing on profitability, not just valuation hype, and MSMEs are now seen as offering substantial returns through solid unit economics.

The Investor’s Perspective on MSME Funding

Vijay Shekhar Sharma puts it simply: “If your business has repeat customers, solid cash flow, and a clean story, you don’t need to chase investors. Investors will chase you.”

MSME consultants play a pivotal role in preparing businesses to meet these expectations. Here’s what investors are looking for:

• Customer Loyalty & Consistent Demand
• Clean Documentation: Including tax filings, GST, and Udyam certificates
• Embracing Digital Tools: Invoicing, payments, CRMs, analytics
• Solid Financials: Clear projections and business plans
• Mentorship from MSME Consultants: MSME experts guide small businesses in making their operations investor-ready.

Government Schemes for MSMEs

While private investors are showing interest, government schemes remain the foundation of MSME growth. Key schemes include:

• Credit Guarantee Fund Trust for MSMEs (CGTMSE): Collateral-free loans up to ₹5 crore
• PMEGP: Subsidy-based loans for new micro enterprises
• SIDBI SMILE Scheme: Soft loans for manufacturing MSMEs
• Startup India Seed Fund Scheme: Grants and investments up to ₹945 crores
• MSME Champions Scheme:Focuses on digitization and capacity building, offering loans up to ₹5 crore

These government-backed MSME funding schemes allow businesses to access low-interest loans and collateral-free credit while also incentivizing innovation and job creation.

Learn more about MSME registration processes for eligibility under these schemes by visiting our MSME registration guide.

How MSMEs Can Get Funding-Ready

So, how can MSMEs take advantage of this wave of funding? Here’s how you can prepare:

• 1. Cross the Growth Loop: Avoid stagnation. Scale up your business to become a larger player and break free from the constraints of smaller operations.
• 2. Leverage Financial Services & Technology: Invest in financial technology and digital tools to help manage cash flow, payments, and sales, all of which make your business more attractive to investors.
• 3. Embrace Economic Growth: MSMEs are critical drivers of economic growth and job creation. As they scale, they help improve the local and national economy.
• 4. Seek Guidance from MSME Experts: MSME consultants are invaluable in helping you understand your funding options, prepare your documents, and connect with the right investors.

Learn how to enhance your business’s digital footprint through MSME training programs to stay ahead.

The Role of MSME Consultants in India’s Growth Story

In this new era, MSME expert consultants play a crucial role in helping MSMEs unlock funding opportunities. Here’s what they can do for you:

• Identify eligible government schemes like PMEGP, CGTMSE, and MUDRA
• Prepare pitch decks, project reports (DPRs), and financial documents
• Help businesses get listed on GeM (Government e-Marketplace) or Startup networks
• Connect businesses with investors or lenders who align with their goals

Pro Tip: Start by speaking with a trusted MSME funding consultant to get expert insights on which schemes are the best fit for your business.

For further details, check out the MSME certification process to ensure your business is eligible for these schemes.

Jimit Ghiya

Funding Expert

Joy

Funding Expert

Ankit

Funding Expert

FAQs

• Q1. What is MSME funding and why is it important?

  MSME funding refers to financial assistance provided to Micro, Small, and Medium Enterprises, helping them scale operations, invest in technology, and expand markets, ultimately boosting the economy and job creation.

• Q2. Why are private investors now focusing on MSMEs?

  Private investors are increasingly looking at MSMEs for their profitability, digital transformation, and scalability. Investors are seeking businesses with strong fundamentals and real customer bases.

• Q3. What are MSME consultants and how do they help?

  MSME consultants help small businesses with compliance, pitch preparation, and connecting with government schemes and investors, making them funding-ready.

• Q4. Can an MSME with no prior funding get investor interest?

  Yes, if your business demonstrates product-market fit, steady revenue, and clear governance, investors are likely to back you, even without prior funding.

• Q5. Where can I find a trusted MSME funding consultant?

  Look for consultants with proven success stories, a deep understanding of government schemes and the private funding landscape, and solid expertise in MSME growth strategies.