Impact of COVID-19 on the Financial Management of MSMEs: An Analytical Review

Impact of COVID-19 on the Financial Management of MSMEs: An Analytical Review

Abhijit Sharad Kelkar, Nithya Ramachandran
Copyright: © 2023 |Pages: 21
DOI: 10.4018/978-1-6684-5342-1.ch011
OnDemand:
(Individual Chapters)
Available
$37.50
Current Special Offers
No Current Special Offers
TOTAL SAVINGS: $37.50

Abstract

With the advent of advanced information technology and related tools in late 1990s, the scope, nature, and avenues of the business opportunities and its financial perspectives changed. Stabilization and equating of the demand and supply for the sources of inflows and outflows of funds remained the challenges across the industry. The struggling players during this time remained MSMEs due to their limited scale and more importantly limited cushioning capacity to absorb the shocks of financial downs. The micro, small, and medium enterprise (MSME) sector has emerged as a highly vibrant and dynamic sector of the Indian economy over the last five decades. It contributes significantly to the economic and social development of the country by fostering entrepreneurship and generating many employment opportunities at comparatively lower capital cost, next only to agriculture. MSMEs are complementary to large industries as ancillary units, and this sector contributes significantly to the inclusive industrial development of the country.
Chapter Preview
Top

Introduction

Small and medium-sized enterprises (MSMEs) have developed into a vibrant and active segment of the Indian economy, according to Gade (2018). It has been discovered to be a determinant in a person's growth and development. MSMEs contribute significantly to the creation of jobs at a low cost of capital, to the establishment of enterprises in less developed regions, to the reduction of regional inequalities, and to the equitable distribution of the country's income and wealth. MSMEs act as support groups for a wide variety of businesses, increasing chances for vertical integration in rural and distant locations and so providing a significant contribution to the country's budget. MSME, as well as the agriculture business, offer several prospects for both personal and paid employment. MSME is associated with higher economic growth rates, inclusive and long-term populations, and low-cost non-agricultural livelihoods in a variety of ways, including promoting gender equality in society, ecologically sustainable growth, and, most importantly, protection against deflation, as MSME has always demonstrated.

Complete Chapter List

Search this Book:
Reset