AI emerges as key growth driver for MSMEs, Vodafone Idea study finds

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India’s MSME sector, which contributes over 31% of GDP, is accelerating its digital adoption, with AI emerging as a key driver of scale. The latest Vi Business MSME Growth Insights Study 2026 reveals that 57% of MSMEs view AI as a vital tool for business growth, while 25% have already deployed AI solutions in their workflows.

The study, based on Vi Business’s ReadyForNext platform that engaged over 2.5 lakh MSMEs across 16 sectors, shows India’s Digital Maturity Index (DMI) rising to 60.8 in 2026, up from 58.0 in 2025. Telangana (68.3) and Karnataka (65.7) lead state rankings, while Andhra Pradesh entered the top 10 for the first time.

Key findings

Cybersecurity adoption: 46.3% of MSMEs have adopted cyber defence solutions to counter rising online threats.
Women-led MSMEs: Achieved a DMI of 61.6, outperforming male-led businesses at 60.4.
Digital Workplace: Fastest-growing pillar, rising from 57.5 in 2023 to 65.7 in 2026, driven by collaboration platforms and HRMS solutions.
Digital Operations: Improved from 56.5 to 62.0, reflecting stronger process efficiency and resilience.

Financial readiness introduced

Vi Business has expanded its assessment framework by adding Financial Readiness as the fourth pillar, alongside Digital Customer, Digital Workplace, and Digital Operations.

This new benchmark will evaluate MSMEs’ funding preparedness and risk coverage awareness, mapping how effectively digital adoption translates into financial strength.M P Sunil Kumar, Chief Enterprise Business Officer at Vodafone Idea, said: “India’s MSMEs are moving beyond basic digitisation towards building intelligent, secure, and future-ready enterprises. By introducing the Financial Readiness Pillar, we aim to provide an ecosystem blueprint that helps small and medium businesses evaluate resilience, secure funding, and scale sustainably.”

Sectoral and regional highlights

Financial Services emerged as the most digitally mature sector (DMI 67.3), overtaking IT & ITeS (66.2).
Retail recorded the strongest improvement, rising 9.9 points to 61.9, driven by omnichannel adoption and digital payments.
Tourism & Hospitality, Energy & Utilities, and Transportation also showed strong gains.
Eastern states continue to lag, with no representation in the top 10 digitally mature MSME ecosystems.

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