A recent study by Paisabazaar reveals that over 70% of MSMEs and self-employed individuals seek loans for immediate financial needs, primarily for working capital, raw materials, and debt consolidation. Less than 30% apply for loans aimed at growth initiatives such as marketing, machinery upgrades, or office expansion.
Metro cities like Delhi NCR and Mumbai lead in loan applications, accounting for 53% of demand alongside other top metros, while non-metro cities like Jaipur and Surat contribute significantly to the remaining 47%.
Around 45% of loans cater to working capital requirements, highlighting liquidity challenges faced by businesses in covering salaries, rent, and operational costs. Additionally, 24% need loans to manage inventory, and 15% focus on marketing and branding efforts. Nearly 9% apply for loans to upgrade machinery and technology for improved efficiency and product quality.
This trend underscores the critical need for uninterrupted financial support to sustain daily operations and meet customer demands.
