Cash flow struggles, access to finance continue to be major barriers for India’s small businesses: CPA Australia survey
India’s small businesses last year. Among various costs, staff costs and materials were the costs that caused the most harm to small businesses in 2023, findings by global accounting body CPA Australia revealed in its latest survey.
To cover increasing expenses and support business growth, many Indian small businesses sought external funds, the survey noted. “68% sought external funds last year, dropping 20 percentage points from 2022. However, reflecting strong growth expectations, 81% plan to access finance this year,” it stated.
The survey, which collected views from 4,222 small businesses in 11 Asia-Pacific markets across Australia, Mainland China, and Malaysia, also included 505 respondents from India.
In findings on access to finance, the survey revealed that 42% of the respondents said it was easy to seek funds in 2023, a sharp decline from 69% in 2022. “In 2024, 43% anticipate it will be easy to access funds, also dropping from 64% in the last survey,” it noted.
Speaking on the survey findings, Prafulla Chhajed, a CPA member of CPA Australia in India and Ex-President, ICAI, stated that difficulty in accessing finance is a common challenge for small businesses worldwide. “Though government loans like Pradhan Mantri MUDRA Yojana (PMMY) help to foster entrepreneurship by offering financial support, MSMEs should not solely rely on borrowing to fund their long-term development, particularly in a high-interest rate environment,” he said.
Despite such issues at play, it is encouraging to see that Indian SMEs
