By Sakait Chaudhary

As a transformative tool that helped bridge the gap between rural and urban markets, e-commerce has made the reach of consumer products infinite. By reaching the remotest of villages and connecting sellers and buyers even in the remotest of towns in the country, the sector has played a pivotal role in making online shopping inclusive. The democratization of e-commerce, wherein the rural and urban markets are at par in terms of access to an affordable array of products, bodes well for the overall economic growth and development of the nation.

According to the Indian Brand Equity Foundation, an initiative by the Ministry of Commerce and Industry, the e-commerce market in India will surpass the US to become the second-largest market in the world by 2034. The report suggests the e-commerce market will reach US$ 111.40 billion by 2025. An interesting trend was that Tier-2 and Tier-3 cities in India transacted more than ever and a large number of the rural population was shopping online. This massive rise of e-commerce has enabled MSMEs in India with a pivotal opportunity to grow and innovate to their fullest potential.

How Indian e-commerce has helped MSMEs flourish despite barriers

A major contributor to India’s economy, the MSME sector employs a whopping 100 million plus people across the country. While in terms of reach, they were largely restricted to a local offline market, until a few years ago, partnering with e-commerce platforms has helped open a marketplace full of consumers, and that too, virtually.  

E-commerce platforms with their advanced tech capabilities and forward-looking policies have helped small and medium businesses transcend geographical boundaries, thus enabling rural MSMEs to connect with customers beyond their immediate vicinity. This includes policies such as seamless 10-minute onboarding on the e-commerce website, ease of product listing and cataloguing, best-in-class payment/return policies, and guaranteed ROI delivery on Ads for sellers. Many such strategically underlined solutions and capabilities have made it easier for the seller community in India to do an efficient business and grow in the online marketplace.

Also read: ‘Rural is becoming accretive to FMCG growth in recent months’, says Ritesh Tiwari, CFO, HUL

Besides connecting small and medium sellers with customers across the spectrum, these policies have also helped reduce the cost of operations through tech-led interventions, assisting them across all touchpoints and supplementing their business needs. This has also encouraged even more sellers to adopt online marketplaces and experience the convenience associated with them.  

E-commerce initiatives are further enabling the contributions made by Government initiatives such as Digital India, Skill India, Startup India, and Make in India. It is accelerating online trade and allowing more sellers to join the digital ecosystem from Tier-2 markets. For example, through the Digital India campaign, every village is now connected via an optical fiber, making the internet accessible to rural people.

With internet-enabled, rural people are in a position to buy products and services online. This has changed their lifestyle and also created a source of income for them. The availability of the internet has created a huge scope of eCommerce in rural India. People are getting their household products delivered to their doorsteps and retailers can also sell their products online and grow their customer base.

Expanding internet access in rural areas has helped people to purchase household products online and get them delivered to their doorstep, thereby fueling the growth of MSMEs. Other factors such as advancements in payments and computing on mobility platforms, changing consumer behaviour and shopping patterns, and availability of wider products owing to the sellers from tier-II and tier-III and products priced at lower rates on e-commerce platforms have also helped build bridges, despite barriers.

However, many small and medium sellers have no or limited digital expertise and tech capabilities for their business, which still pose a challenge to their growth in e-commerce. This could be addressed through capacity building and digital literacy programs to empower rural entrepreneurs with the skills needed to leverage e-commerce effectively.

Enabling a sustainable growth path for MSMEs

Bringing rural sellers and buyers into the e-commerce fold and integrating them into the mainstream is crucial for the overall growth and development of the economy because the Indian rural market is vast and diverse. Pathbreaking marketplace policy changes and new capabilities reinforce the e-commerce sector’s efforts to enable and empower more entrepreneurs with each passing year. Technology, innovation, supply chain, and business processes that help build a sustainable and inclusive platform have made it seamless for MSMEs to onboard. With industry-first innovations, e-commerce players can equip MSMEs to keep pace with the growing needs of consumers on their journey toward strong, sustainable growth.

(The author is Business Head – Marketplace, Flipkart. Views expressed are the author’s own and not necessarily those of financialexpress.com.)