Closure rate among MSMEs rises to 32 pc from 24 pc in October: Report

Small and medium businesses in India and Pakistan reported higher rates of closure, according to a new Facebook global report revealed on Thursday.

The Global State of Small Business Report stated that the closure rates rose in February (when the survey was conducted) to 32 percent as compared to 24 percent in October. The closure rates peaked in May 2020, when the number reached 46 percent in India.

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The year 2020 has been tumultuous for the Indian MSME sector, which took a massive beating during the COVID-19 pandemic, with numerous surveys showing that the disruptions impacted earnings by 20-50 percent.

Commenting on the launch of this report, Sheryl Sandberg, Chief Operating Officer of Facebook, said, "Small businesses around the world have struggled since the start of the pandemic more than a year ago. While the roll-out of vaccines gives a reason to be hopeful, our latest Global State of Small Business Report is a timely reminder that many are still vulnerable and need support."

Sheryl had said that COVID-19  is not just a public health emergency but also an economic crisis that is "hitting small and medium-sized businesses exceptionally hard" in a statement last year.

The report also highlighted that about 45 percent of the MSMEs in India reported a decrease in employment. Additionally, 42 percent of the Indian SMBs reported they had rehired former employees in the last three months.

More than 35,000 small business leaders across 27 countries and territories were surveyed as part of this project in February.

More than 200 million businesses across the world use Facebook, Instagram, Messenger, or WhatsApp every month to sell their products and directly connect with their customers. Moreover, Facebook also launched Facebook Shops, a platform to make selling easier online recently. Another initiative by the tech giant- Business Resource Hub- helps small business owners get information, training and advice on various aspects.