[India MSME Summit 2021] How Mastercard is enabling digital solutions for MSMEs

The COVID-19 pandemic has accelerated the pace of digital transformation of almost every business in India. However, the coronavirus lockdown across the country majorly impacted the micro, small, and medium enterprises (MSMEs), a sector that contributes 30 percent to India’s gross domestic product (GDP). 

Some of the major challenges faced by MSMEs in India include increasing sales, getting access to capital, and efficiency in operations, which can reduce the cost. 

According to a report released by Avendus Capital in October 2020, with 130 million Indians shopping online, starting an online business is the only option available to MSMEs. 

Speaking at YourStory’s MSME Summit, Vikas Saroagi, Vice President, Merchant Acceptance, South Asia, Mastercard, said, setting up a digital payments channel can help MSMEs on all three fronts. 

“Once an MSME enables digital payments, they enter the formal sector. This not only helps them increase their profits, but also enables them to raise capital,” he said.  

Setting up a website and enabling digital payments help businesses to not only increase sales by attracting domestic and international customers but also enables access to capital. 

According to Vikas, small firms, which have started using digital payments, can grow their profits twice as fast compared to enterprises operating on cash transactions.

“People want to shop online and taking payments online gives the omnichannel experience,” says Vikas. Also, the payment time decreases by 70 percent when transacting in digital money. 

While the rise of digital payments is undoubtedly a boon for the country, increasing digital payments also means a direct invitation to cybercriminals. 

“A business owner needs to protect their website as they would secure their physical store. Just like you’d put grills on windows and lock the doors before leaving, you need to protect your website from cybercrimes,” said Sujay Vasudevan, Vice President, Cyber and Intelligence Solutions, South Asia, Mastercard, at the MSME Summit.  

Digital payments have evolved very quickly in the last three to five years. The payment adoption, which would have taken several years to happen, has been accelerated due to the pandemic. 

“Phishing emails are some of the most common ways to get access to someone’s data. If anyone responds to these emails, the attacker gets access to the user’s data and then they send more emails, text messages, and even make calls. They will always create a sense of urgency about winning a lottery or banks requesting to share an OTP (one-time password). Cyber offences have also gotten democratised over the last few years. Anyone can find a toolkit and start hacking data,” said Sujay.

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Such crimes can seriously hinder the growth of a growing business. Not only that, but digital acceptance could also get affected in areas where people actually become victims of these cybercrimes. 

Sujay suggests investing in legitimate and licensed anti-virus software to get protection from such cybercrimes. Businesses are also advised to not use a duped version of these softwares as it might make their website more vulnerable to cyber thefts. 

But until an enterprise does not have cyber protection, they should not respond to any emails claiming unimaginable rewards or share bank details with anyone.