The micro, small and medium-sized enterprises (MSMEs) have made significant contributions to the country’s economy and serve as a robust platform for business innovation. According to data from the MSME ministry, there are about 6.3 crore MSMEs in India, providing employment to about 11.10 crore Indians and contributing to about 27% of the country’s GDP. It is important to note that the micro segment makes up more than 99% of the MSME population while the Small & Medium segment makes up less than 1% of the MSME universe.
Compared to large or multinational companies backed by relatively deeper pockets, MSMEs need an absolute minimum protection plan to manage the risks. The FY22-23 Union budget also reiterated the need to make the SME sector more robust and provide ways and means to mitigate risks such as fire, theft or worker safety. Most of these MSMEs are often business ventures where the promoter has invested their savings or borrowed money to start a new business.
Compared to large or multinational companies backed by relatively deeper pockets, MSMEs need an absolute minimum protection plan to manage the risks. The FY22-23 Union budget also reiterated the need to make the SME sector more robust and provide ways and means to mitigate risks such as fire, theft or worker safety. Most of these MSMEs are often business ventures where the promoter has invested their savings or borrowed money to start a new business.
Given their small size and scale of operations, most of these MSME units are prone to risks that threaten their overall business objective – something they’ve been doing for years to scale. Insurance protects against sudden shocks and uncertainties and helps reduce the negative effects on the long-term business plan of the MSME, thus ensuring the longevity and livelihood of the business.
