Microenterprises are small businesses that employ 10 or fewer people with investments of less than Rs. 25 lakh. They aim to provide employment, increase incomes, and target poor and unemployed groups. Common microenterprises include handicrafts, transportation, and restaurants. They play an important role in the Indian economy by generating jobs and promoting development in rural areas. However, microenterprises require policy support and access to finance to help them grow.

1. Micro Enterprises in India
By
Rajat Jaiswal

2. What is micro enterprises?
“A Micro enterprises can be a small business employing 10 or less,
microenterprises are based on family business or lower scale
business”, we can say that microenterprises are the asset-Building
Strategy.
According to RBI
“A micro enterprise is an enterprise where investment in plant and
machinery does not exceed Rs. 25 lakh”.

3. Aims and objective of Microenterprises
• The objectives of small business and microenterprise
programs— economic development, job creation, or self
sufficiency in poor people.
• To provide large employment in rural backward and urban areas.
• To promote growth and development of the Khadi, village and
coir Industries.
• To provide employment those people who has limited skills and
education.

4. • To provide services such as marketing, training in basic business
skills, and technology transfer.
• Increased income of women is invested in health, education and
housing for their families welfare.
• To erase micro business difficulties.
• To provide supervision and business regulation for
microenterprises.
• Increase women's participation and local communities
involvement in small business sectors.

5. • To provide business loans for microenterprises.
• Microenterprises target tribal, poor, and unemployment
population.
• To formulate Micro business policy's for planning commission
and governments poor elevation programs.
• To provide small business workshop and training program for
uneducated and unskilled people.

6. Micro enterprises in tourism sector
• In tourism context it promote to open souvenirs and handy
crafts small units.
• Microenterprises also help to open a travel agency.
• Pashmina shoal, glass work on clothes, jari sari, handlooms,
khadi and wooden products are some Microenterprises products
in tourism.
• Microenterprises help to open a small transportation service in
tourism like they provide taanga and auto.

7. • Micro enterprises help in to promote gastronomy and cousins of
a destination like it help to open a restaurant.
• Microenterprises promote rural tourism and develop rural art
and hand made things like mud pots, paintings, statues and jury
work on clothes.
• Organized training and development program for less educated
and unskilled people for to survive in tourism industry.
• Microenterprises organize many programs for to promote art
and cultural quality of local community's like dance, painting,
folk singing and handicrafts.

8. Types of enterprises in India
Enterprises
manufacturing
service
25 lack
5 core
10 core
10 lack
2 core
5 core
medium
small
micro

9. MICRO & SMALL ENTERPRISES - CLUSTER DEVELOPMENT
PROGRAMME
The Ministry of Micro, Small and Medium Enterprises (MSME),
Government of India (GoI) has adopted the cluster development
approach as a key strategy for enhancing the productivity and
competitiveness as well as capacity building of Micro and Small
Enterprises (MSEs) and their collectives in the country. Clustering of
units also enables providers of various services to them, including
banks and credit agencies, to provide their services more
economically, thus reducing costs and improving the availability of
services for these enterprises.
Source of information is

10. The helping hand IFC (international finance corporation)
Forty million new jobs need to be created in South Asia by 2016[1]
to absorb newcomers in the labor market. Small and medium
enterprises will be the main providers of these jobs. Improving
performance is critical to their success, making it easier for them to
operate, expand, and generate business opportunities.
IFC has a decade of experience working with small and medium
enterprises in this region, providing scalable and replicable
solutions throughout the lifecycles of small businesses. In 2002, IFC
established the South Asia Enterprise Development Facility to
enhance performance, competitiveness, and growth of small and
medium sized firms in Bangladesh, Bhutan, Nepal, and North East
India.

11. • IFC provides investment and advisory services to help small and
medium enterprises through their entire life cycle - right from
inception to growth and maturity. We do this by assisting in
introducing regulatory reforms, building management skills and
supporting access to finance and markets.
• IFC trained 233,000 entrepreneurs to be more efficient and
productive.
• More than 150,000 small and medium enterprises have
received improved access to financial services.
Source of information
IFC (international finance corporation)

12. Case study on Bihar
the Indian state of Bihar to simplify tax laws and procedures to
reduce compliance issues and encourage small businesses to
register as taxpayers, thus widening tax base, and improving
business climate.
Bihar state adopted several progressive measures such as a fixed
rate of tax for micro and small enterprises with no routine scrutiny,
online filing of returns for larger enterprises, simplified admission
of appeals, and faster resolutions and refunds.
The project started in 2009 and by its closure in September 2013,
the project recorded a 24 percent increase in the tax payer base.
The number of tax payers filing e-returns has increased to 22,000
(from a base of 149 in 2009). 93 percent of tax revenue is collected
electronically in Bihar now.

13. The number of small tax payers registered under a special,
simplified scheme for small tax payers is at 6,800. According to an
appraisal by Indian Market Research Bureau, an international
market research and consultancy firm, businesses in Bihar agree
that tax compliance is less burdensome after reforms, and ease of
doing business has improved.
Source of information
IFC (international finance corporation)

14. Case study on India Udyogini
Udhyam Jagaran Sansthan (UJAS). Udyogini has helped establish women-owned
and operated associations called UJAS, to provide production, training and
business support services for the producer members. UJAS is also the brand
created by Udyogini’s members. In Bikaner, the UJAS brand of embroidery and
appliqué products are sold in exhibitions in India. In Pugal, UJAS have initiated (and
are managing) an embroidery production, training and business centre, with about
900 women members of the embroidery association. The main activities include
provision of raw material kits, the collection of finished products, quality control,
dispatch of finished goods to suppliers, and disbursement of payments. Udyogini
facilitates linkages with fashion institutes. to provide beneficiaries with intensive
training. Beneficiaries’ participation in exhibitions is encouraged to establish
linkages with buyers and traders.
Value chain approach. In Udyogini’s experience, the value chain approach is useful
to promote enterprises, and to take advantage of particular existing market
opportunities to the advantage of the poor. The organization’s experience in
Mandla, Saharanpur and Bikaner, has shown that aggregation is a key requirement
to obtain the necessary volumes to reduce costs and compete in the market.
Impact on target group. The project is reaching the poorest women. Discussions
with Udyogini’s project team have indicated that beneficiaries’ monthly income
increased from USD 33 to 66.

15. The case of a woman entrepreneur
Savitri Bai. Savitri Bai used to cultivate maize on her land, earning a seasonal
income of USD 11-18. After the awareness-raising campaign initiated by
Udyogini on business potentials, technical aspects and market information of
vegetable cultivation, Savitri Bai started cultivating Brinjal. Her seasonal gross
profit rose to USD 417. Initially, she took her vegetables to the market by bicycle;
after realizing that her profits and productivity were increasing, she started
hiring a car for the purpose.
Key features
Effective governance. Udyogini is a dedicated development-oriented
organization. The successful implementation of its projects is attributable to its
success in boosting beneficiary incomes.
Coordinated delivery of services. Projects undertaken by Udyogini have provided
a coordinated delivery of services, including capacity building, technology
transfer, provision of credit, access to market.

16. Value added/Vertical integration. Value adding activities such as product aggregation,
grading and weighing are undertaken by the women producers’ association. Vertical
integration was adopted in selected products. UJAS is the brand under which
members’ associations sell their products. Trust. The formation of producers’
associations contributed to building trust amongst members. However, it is not
evident whether other trust building measures
such as workshops, have been used.
Horizontal integration. Producer organizations have been formed.
Provision of credit. SHGs are used to channel micro credit towards beneficiaries.
Diversification. Producers are encouraged to engage in income generating activities
for products that
• Capacity building. Change in the psychological mindset: encouraging women
to become business entrepreneurs, and to understand, for instance, the need to
take risks. Two stages are required for women to increase their market control: a)
livelihood security; and b) enterprise growth. The first one trains women to
understand market channels and operations, and the requirements for creating
sustainable micro-enterprises. The second one aims at increasing women’s
entrepreneurial skills, so that their enterprises become their primary source of
income, reducing their dependence on intermittent labouring .

17. • Chain efficiency/Competitiveness. Products are competitive with other
generic items in the market. However, it is not evident whether the products
would be able to compete with other stronger actors or brand competitors.
• Inputs. In the case of UJAS in Pugal, members are provided with the
required raw materials.
• Technology transfer. Udyogini encourages and trains members to adopt
improved production technologies.
• Market linkages. In the case of UJAS in Pugal, beneficiaries are encouraged
to participate in exhibitions, especially to establish linkages with buyers and
traders.
• Sustainability. It cannot be judged at this point but the interventions seem
to require the ongoing presence of Udyogini.
source of information
India Udyogini

18. Importance of Microenterprises
• Micro, Small and Medium Enterprises (MSME) sector has
emerged as a highly vibrant and dynamic sector of the Indian
economy over the last five decades. MSMEs not only play crucial
role in providing large employment opportunities at
comparatively lower capital cost than large industries but also
help in industrialization of rural & backward areas, thereby,
reducing regional imbalances, assuring more equitable
distribution of national income and wealth. MSMEs are
complementary to large industries as ancillary units and this
sector contributes enormously to the socio-economic
development of the country.
• It is an export oriented skim and having greater potential to
enhance exports by value addition through technological
interventions and diversified products.

19. • Microenterprises really helpful to improve economy of county as
well as it develop local and poor population for example a small
shop can change life of a whole family in rural and urban area.
•
• today there are many county's and NGOS running campaign for
to promote Microenterprises .
• Microenterprises are the hope for hapless and unemployed
people .
• Microenterprises need again a powerful policy for promotion
and development of low interest loan and finance help.