Published Paper Details:

Small, Medium, and Micro Enterprises (MSMEs) are crucial in the economic process of India, particularly in the semi-urban and rural areas, such as Haveri in Karnataka. Although they are significant, lack of access to formal finance is a significant challenge to MSMEs. Financial Technology (FinTech) services have become a radically new platform in recent years, which has allowed the delivery of digital credits, online payments, and inclusive financial services using UPI, Aadhaar-based KYC, and digital lending applications. This paper will discuss how FinTech platforms are relevant in intensifying MSME financial inclusion in Haveri District. The analysis has been done using secondary data (Pradhan Mantri Mudra Yojana (PMMY)) on the impact of digital financial system on greater access to credit, transparency of transaction, and scalability of business with micro-entrepreneurs. The results show a fast growth in digitally-enabled micro-loans (particularly Shishu loans), 20% growth in MSME credit and high penetrations in digital accounts by Aadhaar. Nevertheless, there are still difficulties in taking MSMEs out of the low-ticket credit and spreading knowledge about sophisticated FinTech services. The paper concludes that FinTech has greatly enhanced financial inclusion, but institutional relationship and repetitive digital literacy initiatives have a crucial role on sustainable MSME development in rural Karnataka.