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MSME Sector Contributed in GDP: Role of Capital Finance

The MSME sector is one of the primary growth drivers of the Indian economy. It is also a leading contributor to India’s GDP, accounting for 24.63% contribution from the service sector and 6.11% from the manufacturing sector.

Due to its considerable weight over the economy and expansive growth opportunities, the Indian government has given effect to multiple initiatives to foster its growth. This roster of initiatives involves the easy availability of capital finance loans to MSMEs.

However, it is also upon businesspersons to determine the precise time at which they should avail of a loan to further its business objectives.

There are multiple circumstances in which a business can capitalize, as the economy, the market, and the business itself is constantly evolving.

For instance, an individual can avail of a business loan to set up its business and finance various aspects such as staff hiring, equipment purchasing, expenses related to office space, etc.

An opportunity to expand or diversify a product line could also be financed with a capital finance loan. Organizations on a growth trajectory and recent success history could aim for expansion or diversification.

Inventory management and purchasing of new stocks to meet increasing market demand is also a business opportunity on which enterprises can capitalize.

Furthermore, it is also essential to upgrade existing equipment and tap on technological advancements to acquire a competitive edge in the market. The hiring of staff could also be an avenue that could be financed with a capital finance loan.

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