Vi Business, the enterprise arm of Vodafone Idea Limited (Vi), has released its third edition of flagship Ready for Next MSME Growth Insights Study 2025. According to the study, as India’s digital economy accelerates backed by Digital India, BharatNet and mobile smaller businesses are exploring digital tools to enhance operational efficiency and expand their market reach.

The study reflected this positive shift, revealing a rise in the country’s Digital Maturity Index (DMI), however the digital adoption remains fragmented. With a strong intent, right financial support and access to right advisory support, India’s small businesses are well positioned to accelerate their digital journey.

Highlights from the study include:

  • Telangana tops national DMI rankings: India’s national DMI rose from 56.6 in 2023 to 57.3 in 2024, and 58.0 in 2025. Regionally, the South leads the digital shift (DMI: 62.9), followed by the West (57.4), East (57.1), and North (55.8). Among individual states, Telangana (DMI: 71.2) has emerged as the digital frontrunner. Hyderabad’s transformation into “Cyberabad” home to global tech firms, government-backed digital infrastructure, and vibrant start-up ecosystems has significantly boosted MSME digital adoption. Kerala (63.7) follows, leveraging its high digital literacy and strong services sector. Maharashtra (59.2) ranks third, supported by Mumbai’s financial services base and Pune’s IT and industrial ecosystem.
  • Digital investment is on the rise; cloud and cybersecurity gain importance: Digital maturity remains uneven across sectors, but the study reveals a sharp rise in investment intent across the board. Professional services tops the list of sectors increasing digital transformation budgets, followed by retail, logistics, transportation, media and entertainment, manufacturing, telecom, agriculture, financial services, and healthcare. Encouragingly, 72 per cent of MSMEs plan to increase cloud spending, and 76 per cent have prioritised cybersecurity as a response to rising cyber threats.
  • Gender parity in digital leadership: Women entrepreneurs (DMI: 57.4) are closing the gap with men (DMI: 57.7) and even leading in cloud and security uptake in niche sectors like education and IT though on a small base. Entrepreneurs aged 40-60 lead the pack (DMI: 64.0), showing that being digital savvy is no longer just the domain of younger founders (DMI: 57). Digital maturity is growing, but just 12 per cent of MSMEs are fully digitalized, adoption remains fragmented. The study shows a steady increase in Digital Maturity with the country’s DMI increasing to 58.0 in 2025. However, it also reveals that only 12 per cent of MSMEs have reached full digital maturity, indicating that adoption remains fragmented. While digital tools are being explored across sectors, critical gaps remain in areas like customer engagement technologies and internal collaboration platforms. This signals that intent is rising faster than execution, especially among micro and small businesses, where financial capacity and advisory support continue to be barriers.

While awareness and intent are rising, the pace of digital adoption is still closely tied to financial capacity. The study found that MSMEs with higher turnover typically in more than Rs 0.5- Rs 1 billion range – report significantly greater digital maturity, as they are better positioned to invest in advanced tools across cloud, automation, and customer engagement. In contrast, younger or smaller MSMEs, despite being digitally aware, continue to make measured, phased investments due to budget constraints.

Commenting on the release, chief enterprise business officer, Vi, said, “MSMEs in India are clearly moving from digital curiosity to digital commitment, and that is an encouraging shift. The sharp rise in investment intent around cloud, cybersecurity, and automation shows that small businesses increasingly see technology as a growth enabler, not just a utility. Through Ready for next program, our aim is to celebrate incredible growth journeys of India’s MSMEs from small towns to global markets, from manual processes to being digital-first enterprises.”