More than half of India’s micro, small and medium enterprises (MSMEs) now see artificial intelligence as central to their future growth, highlighting the technology’s increasing role in the country’s digital transformation journey.

According to the latest edition of the Vi Business MSME Growth Insights Study 2026, 57% of surveyed enterprises view AI as a core tool that can enhance and accelerate business growth, while 25% have already integrated AI into their business practices and operational workflows. The findings come against the backdrop of the MSME sector contributing over 31% to the country’s GDP, the report added.

The study, based on insights from Vi Business’s ReadyForNext platform that sees engagement from around 250,000 MSMEs across 16 sectors, found that the overall Digital Maturity Index (DMI) rose to 60.8 in 2026 from 58.0 in 2025 and 55.9 in 2023.

“India’s MSMEs are moving beyond basic digitisation towards building intelligent, secure, and future-ready enterprises. The growing adoption of AI, rising digital maturity levels, and increasing investments in workplace and operational technologies reflect a perceptible shift,” M P Sunil Kumar, chief enterprise business officer, Vodafone Idea Limited said.

Vi Business MSME Growth Insights Study identified AI, software-as-a-service (SaaS)-based workplace collaboration and cybersecurity as the three technologies expected to drive the next phase of MSME growth by improving productivity, enabling scalable operations and strengthening business resilience respectively.

Cybersecurity adoption has also gathered pace, with 46.3% of Indian MSMEs deploying cyber defence solutions to counter growing online threats, making it one of the biggest contributors to the rise in digital maturity.

The study found digital transformation to be broad-based. Women-led MSMEs recorded a DMI of 61.6, marginally ahead of male-led businesses at 60.4. Digital Workplace emerged as the fastest-growing pillar, rising to 65.7 in 2026 from 57.5 in 2023, reflecting higher adoption of workplace collaboration platforms, productivity suites and HR management software. Digital Operations also improved to 62.0 from 56.5 over the same period, the report added.

“By introducing the Financial Readiness Pillar, we (Vi Business) aim to provide an all-inclusive ecosystem blueprint that helps small and medium size businesses evaluate their resilience, secure funding, and scale sustainably in a highly competitive global market,” Kumar added.

Among sectors, Financial Services emerged as the most digitally mature with a DMI of 67.3, ahead of IT & ITeS (66.2), while Telangana topped the state rankings at 68.3, followed by Karnataka and Maharashtra. The study also found that four-fifths of MSMEs now have an online presence, although one-fifth remain completely offline and a significant proportion still do not operate their own websites.