India's rural businesses catching up as online usage surges
Informal firms in Maharashtra, Goa, and Karnataka are pioneering digital connectivity across India, as per a recent government survey. The study focused on non-agricultural entities not registered under the Companies Act. These firms have shown an increased reliance on the internet, due to its easy availability. Two out of five companies in these states use the internet for tasks such as taking and placing orders or using UPI.
Digital connectivity gains momentum across India
A Moneycontrol analysis revealed that nine out of 36 states and Union territories had over 30% of informal companies using the internet for entrepreneurial purposes. This is a significant increase from just one state in the previous year. Northeastern states, along with Haryana and Gujarat, have made significant gains with internet usage almost doubling within a year. However, larger states like Uttar Pradesh and Odisha still lag behind with less than a tenth of firms using the internet.
Urban-rural internet usage gap narrows
The gap between urban and rural internet usage has significantly decreased within a year. In 2022-23, urban areas had just over twice the internet usage compared to rural informal firms, a decrease from nearly three times in 2021-22. In Kerala and Haryana specifically, urban usage was only a tenth higher than rural usage. This indicates an increasing trend of digital connectivity in rural areas across India.
Computer usage remains low across Indian firms
Despite rising internet use, computer usage remains low across India with only 6.1% of firms in both urban and rural areas using a computer. This is only slightly up from 5.5% a year ago. Moneycontrol found that companies hiring workers were more likely to use internet to expand their business, than family-run firms. Nearly one in four firms that hired workers used a computer, and about half used the internet, compared to 3% and 16% usage among family-run businesses, respectively.
