New Delhi, April 4: The share of micro, small, and medium enterprises (MSMEs) in India's GDP will rise to 40 per cent by 2030, from about 30 per cent currently, a report said on Saturday.
The report from B2K Analytics stated that India's GDP is projected to reach Rs 537.96 trillion by 2030 if the current growth trend continues, which would increase the contribution of the MSME sector to approximately 40 per cent, or around Rs 215.18 trillion.
The report also estimated that the total funding requirement for the MSME sector would be Rs 162.92 trillion by 2030.
Out of the total funding requirement, formal credit availability is projected at Rs 78.02 trillion, comprising Rs 56.98 trillion from priority sector lending, Rs 18.57 trillion from scheduled commercial banks, and Rs 2.46 trillion from NBFCs.
An additional 30 per cent of the funding gap is expected to be met through promoters' own capital, while 5 per cent is expected to be met through informal sources, leaving an estimated unmet requirement of Rs 55.18 trillion by 2030.
"Our projections reflect strong long-term growth trends in terms of the expansion in MSMEs' contribution to GDP. Formal credit growth is also expected to move in tandem," said Ritaban Basu, CEO, B2K Analytics.
He called for expanding formal financing channels to close the credit gap in the MSME sector.
The report also suggested deepening credit penetration and developing innovative funding mechanisms to sustainably support MSME growth. It urged formalization as a priority, as around 95 per cent of the MSMEs operate informally, making it difficult for lenders to assess their creditworthiness.
Filing GST returns could improve the transparency of MSMEs around their business activity and financial performance, it suggested.
"Adopting digital payment systems such as UPI and online banking helps create a verifiable transaction history, enabling lenders to better evaluate financial health. These systems also improve cash flow management, giving MSMEs greater control over their finances while maintaining clear financial records," the firm said.
Digital payment systems also enhance credibility and increase access to priority sector lending and government schemes. It also recommended equity-based financing, such as SME IPOs on stock exchanges, which allow MSMEs to raise capital directly from the market.
As of February 2026, Maharashtra has the highest number of MSMEs in India with over 11 crore registered units. The state's diversified industrial base, widespread urbanization, and mature infrastructure, especially in economic hubs like Mumbai, Pune, and Nashik, led to this huge lead.
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