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COVID push: Indian small-town retailers going digital with business activity back to normal levels – reveals OkCredit data

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16 out of 36 States and UTs witnessing business activity levels higher than pre-Covid times; Karnataka, Maharashtra, Gujarat, Andhra Pradesh, Tamilnadu & Delhi are trending at 90-95% of their pre-Covid activity levels

Business activity among the micro, small and medium enterprise sector which are regarded as the backbone of the Indian economy is fast reaching near normal levels and they are rapidly adopting digital business tools to drive efficiency and growth, reveals data gathered by OkCredit, the pioneers in digital bookkeeping apps which are fast becoming a new rage among hereto unorganized retailers and traders in India.

According to data gathered by OkCredit basis the behavior of the users, the micro retail players are increasingly taking up digital bookkeeping solutions, as it makes their book-keeping task simpler, digitized and secure and there is stronger demand coming from small towns and hinterlands.

In the unlock phase of Covid pandemic, OkCredit has witnessed strong recovery in demand for its app from tier 3 cities followed by tier 2 and tier 1 cities. OkCredit’s business from tier 3 cities witnessed 33% growth in the period of February – September 2020 while Tier 2 and Tier 1 cities registered 30% and 28% growth respectively during the same time. This is after a dip of 26%, 31% and 38% in business from tier 3, tier 2 and tier 1 cities respectively in April this year.

On a pan India basis, data among the digital bookkeeping users points to a sharp recovery with smaller businesses in tier 3 and tier 2 towns growing faster than tier 1 cities. Sixteen of thirty-six states and union territories have recovered to business activity levels that are higher than pre-Covid times. Bihar, Haryana, Assam, Rajasthan, and Himachal are the states where business activity is 10+% higher. Uttar Pradesh, Madhya Pradesh, Chhattishgarh, Odisha, Jharkhand, Uttarakhand, and Punjab are the others that are already exhibiting higher business activity. Out of the 19 states that are yet to recover, Karnataka, Maharashtra, Gujarat, Andhra Pradesh, Tamilnadu & Delhi are trending at 90–95% of their pre-Covid activity levels.

At a business category level, different magnitude and pace of recovery was observed by OkCredit since February 2020. The company witnessed double-digit growth in business from medical and kirana stores at 21% and 15% respectively in September 2020. This was after a dip of 12% in business from medical stores and 22% from kirana stores in April this year. Both mobile recharge and electronics category registered modest growth of 5% in September 2020 after a dip in April this year.

According to Harsh Pokharna, Co-founder and CEO, OkCredit, “The best part for us today is that we are able to get a pulse of the business situation among the trader segment which have traditionally been off the radar for all other retail tracking studies, as they largely belong to the unorganized cash economy segment of the country. It is interesting to note that amid the Covid pandemic, remote towns are emerging as the torchbearers for the digitization of the MSME segment. And they are showing exciting activity and growth as the economy pushes hard for a V-curve recovery”

“We have solid proof coming from remote regions of the country where OkCredit app is being adopted like never before and is recording strong growth in transactions. These trends point to a sharp recovery from pandemic induced slowdown among businesses in tier 2 and tier 3 cities as compared to the tier 1 cities,” he added.

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