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Why small businesses in India struggle with technology

In short

Surveys of Indian small businesses keep naming the same hurdles: software costs too much, budgets are tight, nobody on the team has the skills, and new tools do not connect with old ones. A Zoho survey of 5,149 MSMEs and a DBS survey both name cost as a leading barrier. The fix is help that builds, runs and teaches.

There are crores of small businesses, and many run without a developer

Government figures given in Parliament show 7.22 crore MSMEs registered on Udyam and Udyam Assist as of 30 Nov 2025, up from 5.89 crore on 31 Jan 2025 (Lok Sabha answers on the Sansad digital library). These are registrations, not a count of active firms, but they show how large the field is.

Many of these businesses have no developer on staff. Orders come in on WhatsApp, numbers live in Excel and Tally, and the owner is the one who keeps it all in their head.

Cost is a leading barrier in the surveys we found

A Zoho survey of 5,149 MSMEs, reported by CXOToday, lists high software cost and limited budgets among the top hurdles to adopting software. In the same survey, 81% of MSMEs said they planned to raise their cloud spending in 2025.

An earlier DBS survey from 2021 found that 80% of SMEs named cost as the top barrier to new technology.

So owners want to spend on technology. What stops them is paying for tools they are not sure will work for them.

Skills and getting tools to talk to each other

The same Zoho survey names lack of tech skills and the hassle of connecting tools as hurdles too. This matches what owners describe: a GPS app, a billing system, a WhatsApp group and a pile of Excel files that never agree.

Buying one more tool rarely fixes this. Someone has to connect the tools, keep them running and teach staff to use them. That ongoing help is usually what is missing, more than the software itself.

What this means for a business owner

Start with one daily problem, not a big system. Pick the report you build by hand every morning or the question customers ask most, and fix that first.

Use the data you already have. Most businesses already hold the numbers in Tally, Excel, GPS apps or WhatsApp. The first win usually comes from connecting them, not from buying something new.

Ask who will run it after launch. A tool nobody looks after stops being used. Whoever you work with, ask for a fixed price in writing and a plan to teach your team.

The figures on this page are as published by the named sources. Berri did not run these surveys.

Sources

Common questions

Why do small businesses in India not use more software?

Surveys point to cost first. A Zoho survey of 5,149 MSMEs, reported by CXOToday, lists high software cost, limited budgets, lack of tech skills and the hassle of connecting tools as top hurdles. A 2021 DBS survey found 80% of SMEs named cost as the top barrier to new technology.

How many MSMEs are there in India?

Figures given in Parliament show 7.22 crore MSMEs registered on Udyam and Udyam Assist as of 30 Nov 2025, up from 5.89 crore on 31 Jan 2025. These are registrations, so they do not tell you how many businesses are active today.

Are small businesses in India planning to spend more on technology?

Many say they are. In the Zoho survey of 5,149 MSMEs reported by CXOToday, 81% said they planned to raise their cloud spending in 2025. The same survey shows that cost, skills and the trouble of connecting tools still hold many of them back, so wanting to spend and being able to spend well are not the same thing.

What should a small business fix first with technology?

Pick one problem you face every day, such as a report built by hand each morning or orders retyped from WhatsApp, and fix only that first. Use the data you already have. A small working fix teaches you more than a large system that takes months to set up.

Is it better to buy software or hire someone to build it?

If a ready tool does the whole job, buying it is usually cheaper. Hiring help makes sense when your tools need to work together, or when nobody on your team has time to set them up and run them. Surveys name skills and connecting tools as common hurdles, which ready tools alone do not solve.

Tell us about one problem that costs you time.

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