Delayed payments to MSMEs fall to Rs 7.34 lakh crore: Report

Delayed payments to India’s Micro, Small and Medium Enterprises (MSMEs) dropped to an inflation-adjusted Rs 7.34 lakh crore as of March 2024, compared to Rs 8.27 lakh crore in 2023, according to a new report titled MSMEs’ Access to Finance and Timely Payments published by the Global Alliance for Mass Entrepreneurship (GAME), Federation of Indian Micro and Small & Medium Enterprises (FISME), and C2FO.

Despite the improvement, the outstanding dues continue to pose a significant challenge for India’s 6.4 crore MSMEs, which contribute more than 4.6% of the country’s gross value added (GVA). Persistent payment delays restrict working capital, limit access to credit, and hinder the sector’s expansion.

“Access to finance for MSMEs is a strong pathway for their growth and job creation. While policy interventions are showing positive impact, much more needs to be done to end this chronic issue,” said Ramesh Dharmaji, Senior Advisor at GAME.

Basant Kaur, Country Head at C2FO India, said the reduction was encouraging but emphasised the need for technology-led solutions such as TReDS, ULI, cash flow-based lending, user-friendly platforms like Samadhaan, and early payment systems. She noted that early-payment platforms have been recognised at B20 and COP30 for their potential to unlock up to 1.1% of GDP and increase employment by 3–5% in small economies.