Entrepreneurship Development | Journals

The IUP Journal of Entrepreneurship Development

Problems Faced by Micro, Small, and Medium Enterprises: A Review

Article Details

Pub. Date	: March, 2022
Product Name	: The IUP Journal of Entrepreneurship Development
Product Type	: Article
Product Code	: IJED030322
Author Name	: Mahender, Kapil Gora and Jagdeep Dahiya
Availability	: YES
Subject/Domain	: Management Journals
Download Format	: PDF Format
No. of Pages	: 13

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Abstract

Micro, Small, and Medium Enterprises (MSMEs) are the backbone of both advanced and emerging countries due to their vast contributions to employment creation, trade facilitation, production and development, sales expansion, and elimination of regional imbalances. MSMEs account for the great majority of enterprises in almost all major countries worldwide. They are not able to contribute well to economic growth due to several challenges that impede their performance, including financial problems, lack of knowledge, and poor financial management. The main objective of this study is to explore the problems faced by entrepreneurs and examine their impact on the performance of MSMEs. The findings show that one of the significant issues MSMEs face is financial constraint.

Introduction

Micro, Small, and Medium Enterprises (MSMEs) are the most common business entities in developed and developing economies. They are widely perceived as contributing to the country's economic development at various stages (Lownes-Jackson et al., 2014; and Franco et al., 2021). India's MSMEs are also vital for its economy (Mittal and Raman, 2020). This sector is the backbone of the country's economy, and they appear to be critical to its future growth and development (Okello et al., 2020; and Prakash et al., 2021). Over the previous half-century, the MSME sector has grown into a highly competitive and dynamic segment of the Indian economy (Singh et al., 2016; and Maiti, 2017). They contribute to the global economy by manufacturing and delivering products and services and providing job opportunities for a significant portion of the population (Prijadi et al., 2020).