India MSME Payment Risk Management Solution

India MSME Payment Risk Management Solution

India MSME Payment Risk Management Solutions refers to the sharing of technology that provides ease of payment solutions and reduces the chances of deferred payments. Micro Small and Medium Enterprises hold a sizable share in the GDP of the country. These enterprises apart from their high relevance often face difficulty in receiving payments and identifying certain fraudulent customers due to which the requirement for the companies offering various security and payment tracking services has become crucial. In order to address these issues certain centralized systems, blacklist systems, blockchain-based smart contracts, etc., are being implemented which would alleviate the cases of fraudulent activities and help MSMEs to operate smoothly.

India MSME Payment Risk Management Solution market was valued at USD 253.46 million in 2023 and is expected to grow at a strong CAGR of around 12.21% during the forecast period (2024-2032). One of the key factors that has proven to be conducive to the development of the market growth is the higher number of fraudulent payments among the MSME vendors. As the number of MSMEs in the country is increasing the need for robust centralized systems to identify the defaulters and improve the credit repayments by the customers.

Additionally, the requirement for various types of services such as payment tracking solutions, credit risk assessment tools, fraud detection and prevention software, debt collection solutions, etc., by the MSMEs the demand for payment risk management solutions has increased.

According to the National Sample Survey, there were 633.9 lakh MSMEs in India in December 2022. Of this 630.5 lakh businesses qualify as micro businesses, 3.3 lakh as small businesses, and 0.05 lakh qualify as medium businesses.

Additionally, with the rising government support in terms of regulatory and monetary assistance, the MSMEs in the country would exponentially grow in the coming years further promoting the need for payment risk management solutions. Furthermore, with the increasing number of MSMEs in the country as well as the increase in the sheer number of payments in the country through MSMEs the demand for reducing delayed payments both intentional and unintentional category would require robust solutions to reduce the payment-related issues.

Considering the changes the demand for MSME payment risk management solutions would further increase during the forecasted year i.e., 2024-2032.

• Based on the solution, India MSME Payment Risk Management Solution market is segmented into payment tracking solutions, credit risk assessment tools, fraud detection & prevention, debt collection solutions, insurance & guarantees, and others. Of this payment tracking solutions and debt collection solutions have held a sizable market share. Due to the growing demand for AI-driven credit scoring, blockchain-based contracts, automated payment monitoring systems, etc., many of the MSMEs have focused on availing the respective solution type in order to recover the payments from clients and help maintain the liquidity for day-to-day operations.
• Based on the Type of End User, India MSME Payment Risk Management Solution market has been segmented into manufacturing, B2B Retail and Ecommerce, Construction & Infrastructure, Professional Services, Textile and Apparel, and Logistics and Transportation. Of this, the B2B Retail and Ecommerce segment has held a sizable market share as the sector has exhibited rapid growth in recent years due to the online shopping culture. Additionally, the sector also involves longer payment cycles, multiple intermediaries, and higher credit risks involved. Increased credit sales and high transaction volumes have also resulted in the sector facing payment delays by the vendors due to which the requirement for MSME payment risk management solutions is further anticipated to grow.
• For a better understanding of the market adoption of India MSME Payment Risk Management Solution market it is analyzed based on its presence in regions such as North India, East India, West India, and South India. Of these, the North India region held the largest share in 2023. The region has benefitted from a higher population along with the fast-growing demand for e-commerce products, Additionally, the region has also benefited from a higher growth of manufacturing and construction and infrastructure-related sectors.
• Some of the major players operating in the market include CredAble, LexisNexis Risk Solution, Neural Technologies Limited, SAS Institute Inc., Finsta, CRIF High Mark, Kogta Financial, Altradius, Analog Legalhub Technology Solutions Pvt Ltd., and Beveron.com.