Vi Business Study 2025: India’s MSMEs Are Ready for What’s Next in Digital Transformation

On World MSME Day, Vi Business, the business arm of Vodafone Idea Ltd, launched its third edition of its flagship report, Ready for Next MSME Growth Insights Study 2025. The report offers insights into how India's Micro, Small, and Medium Enterprises (MSMEs) are adopting digital transformation as the central pillar of their growth strategies. With over 2 lakh MSMEs having participated in Vi’s Digital Maturity Assessment over the last three years, the findings are both comprehensive and encouraging.

India’s Digital Maturity Index Continues to Rise

The India's MSMEs Digital Maturity Index (DMI) shows an increase from 56.6 in 2023 to 58.0 in 2025. Although growth is gradual, it is an indication of increasing mindset change. MSMEs are no longer interested in digital tools just out of curiosity; they are increasingly investing in them as a key determinant of business success.

Telangana was the best-performing state with a DMI of 71.2, followed by Kerala (63.7) and Maharashtra (59.2). Overall, South India is at the forefront of the digital push, driven by robust digital infrastructure, high literacy rates, and a flourishing startup sector.

Cloud, Cybersecurity, and Sectoral Momentum

One of the outstanding findings of the survey is the increase in intent to invest in cloud and cybersecurity. Well above 72% of MSMEs expect to spend more on cloud, and 76% of them are focusing on cybersecurity as threats intensify online. Industries like Financial Services, Transport, and Retail are at the forefront of the digital adoption curve, with DMIs of 66, 62, and 62 respectively.

Professional Services, Retail, and Logistics sectors also demonstrate significant budget expenditures towards digital initiatives, reflecting wider transformation across core and new business categories.

Digital Leadership Is Becoming More Inclusive

Women entrepreneurs are also demonstrating phenomenal improvement, with a DMI of 57.4, catching up with their male counterpart at 57.7. In industries such as education and IT, women are even dominating in sectors such as cloud and cybersecurity adoption. With respect to age, entrepreneurs aged 40–60 years are the most digitally advanced, showing digital leadership is not confined to younger entrepreneurs.

The Gap Between Awareness and Execution

Even with encouraging momentum, the research points out that only 12% of MSMEs are entirely digital. Most enterprises continue to be hampered by issues of affordability and accessibility of advisory services. MSMEs with turnover greater than INR 50 crore are digitally more advanced because they enjoy stronger financial capabilities and access to software. However, smaller or younger enterprises continue to implement digital solutions step by step.

Key gaps remain in areas like customer engagement platforms and internal collaboration tools, where smaller businesses still rely heavily on manual processes.

Vi Business and the Road Ahead

Vi Business's Ready for Next platform has now made it to more than 2 lakh MSMEs in 15,000 pin codes and 16 sectors. Certified as India's largest digital advisory platform for MSMEs by Cyber Media Research (CMR), it continues to be a significant go-to guide small businesses through their journey of going digital.

As India's digital economy becomes more robust, it's time for MSMEs to move from mere survival to scaling. The groundwork has been established. The preparedness is there.