Assessing the Impact of Credit on Micro and Small Enterprises

This evaluation assesses the impact of Dell Foundation’s investments in financial service providers that are servicing the Micro, Small and Medium enterprise sector in India.


Micro, small, and medium-sized enterprises (MSMEs) have garnered an increased amount of attention lately and are typically referred to as the ‘backbone of the Indian economy’. Micro, Small and Medium Enterprises (MSMEs) on average account for approximately 99% of all firms, 70% of jobs, and 50-60% of value-added in the OECD area. Their contribution to the country’s GDP has been consistently around 30% over the last decade. Despite these contributions, the MSME  sector in India is trapped in a low-productivity cycle. Existing literature on the subject highlights the flow of institutional credit/access to finance as a significant to MSME growth in India.

Moreover, while there is abundant anecdotal evidence on the impact of credit products and services on enterprise growth, there is a lack of rigorous data on the extent to which access to credit has improved the lives of beneficiaries. The broad objective of this project is to assess the impact of Michael and Susan Dell Foundation (MSDF)’s investments in the MSME lenders in their portfolio, on the ultimate beneficiaries (i.e. MSMEs). The impact assessment will study the progression of performance in terms of overall access to credit, improved credit scoring and so on of the MSMEs supported by the investment.


The impact evaluation will focus on the following priority areas:

  • Loan usage patterns
  • Financial and overall business performance metrics
  • Understanding key inputs of non-financial enablers that determine success
  • Understanding employment creation potential and social protection
  • Business & Gender Perspectives
  • Evaluation of best practices for lending institutions

The assessment will adopt a mixed-methods strategy, considering both primary and secondary data. On the quantitative side, it will involve a longitudinal survey of beneficiaries (primary data) and a review of administration and transaction data, if appropriate and available (secondary data). On the qualitative side, it will involve in-depth interviews with beneficiaries and MSME lenders and/or representatives (primary data), and a review of documents and reports from the institutions.

Related Resources:

Baseline Report: Impact of Access to Finance on Nano Enterprises

Literature Review: Multidimensional Impact of Finance on Microenterprises

Discussion Note: Assessing the Multidimensional Impact of Finance Provided to Microenterprises: Insights from a Workshop Series

Thematic Area

Financial Well-being and Social Protection,

Small, Growing Businesses and Employment

Project Leads

Sharon Buteau


Michael & Susan Dell Foundation