Unincorporated establishments see surge in internet usage post pandemic: NSO | India News

“This demonstrates improved use of information technology (IT) and digital platforms and also indicates a rapid pace of digitalisation in the sector,” NSO said in a statement.

The data also showed that the proportion of unincorporated enterprises using the Internet in rural areas increased from 7.7 percent to 13.5 percent, while the proportion of unincorporated enterprises using the Internet in urban areas increased from 21.6 percent to 30.2 percent during the corresponding period.

Pronab Sen, chairman of the Standing Committee on Statistics, says that post-Covid pandemic, the rise in digitalisation has increased substantially in small businesses as well.

“Small establishments in the vast unorganised/informal sector are also increasingly adopting digital technologies as a way to grow their business and the use of digital payments has become quite widespread now,” he added.

In the Indian context, the unincorporated sector is important because of the large number of establishments it comprises and the magnitude of employment it provides to unskilled, semi-skilled and skilled people, in addition to its contribution to the country’s gross domestic product (GDP). These enterprises typically include small businesses, street vendors, sole proprietorships, partnerships and other enterprises that are not incorporated under either the Companies Act, 1956 or the Companies Act, 2013.

The report further showed that fixed assets owned by unincorporated non-agricultural establishment, on an average, increased to Rs 318,144 in October 2022-September 2023 from Rs 281,013 in April 2021-March 2022, showing an improvement in capital investment in the sector.

“At the same time, the outstanding loan per establishment has increased from Rs 37,408 in ASUSE 2021-22 to Rs 50,138 in ASUSE 2022-23, indicating an improvement in loan availability in this sector,” the NSO statement said.

Moreover, the share of registered establishments has increased from 29.40 per cent in 2021-22 to 36.8 per cent in 2022-23, which shows an increasing trend of registration in the sector. Registration is different from incorporation as the former involves registering establishments under any law or authority such as Goods and Services Tax, Income Tax, etc.

Earlier in June, NSO had released a fact sheet on the survey which showed that the total number of establishments in the unincorporated sector increased to 65 million in 2022-23 from 59.7 million in 2021-22. Among the broad sectors covered, the number of establishments in the “other services” sector has been the highest in ASUSE 2022-23 (37.88 percent), followed by “trade” (34.71 percent) and “manufacturing” (27.41 percent).