Amid salary cuts, layoffs and downsizing of businesses, a new set of micro entrepreneurs – including freelancers and individual-run businesses — are on the rise.
Fintech platforms tracking the space, such as Instamojo and Razorpay, said they have seen a 20-25% growth in payments from microentrepreneurs over the last one month.
Instamojo, which helps small businesses set up online shops along with facilitating payments, has added a new merchant on its platform nearly every minute in the past one month, which is almost 25% of the overall added annually.
These online stores, run by micro-entrepreneurs, have mostly been selling pet essentials, e-books on religion, retail and food during the lockdown period.
Sampad Swain, co-founder of Instamojo, said micro-businesses that go online every year usually clock around $3 billion in gross merchandise value or sales each year.
He expects the growth to further increase even after the Covid-19 outbreak is contained.
Vidit Aatrey, co-founder and CEO of social commerce platform Meesho, also said that micro-entrepreneurship will be up post Covid-19, especially in a scenario of mounting job losses.
“They will start looking for opportunities which are economically viable,” he said.
ET reported in April that more than 600 businesses have downsized staff in the past one month, while a further 660 have cut salaries.
“Before the outbreak, I earned around Rs 80,000-Rs 1 lakh per month. Now, I am earning over Rs 2 lakh. I will continue to work as a freelancer at least for the next 6 months, as none of the companies would be willing to pay me as much as I can through freelancing at the moment,” said Arindam Raha, a 28-year old product designer based in Bengaluru.
Professional networking platforms like LinkedIn and Dribble have helped Raha scout for good projects. He said many of his former co-workers and friends have started freelancing over the past month.
There is maximum demand for designers, programmers and content writers among freelancers, according to experts. Certain roles, however, where employees need to take ownership or are handling sensitive information, cannot be handed over to freelancers, they said.
“The first 20 days (of the lockdown) were slow, when brands were coping with the crisis and paused all projects. But it picked up in April when these brands realised that their customers are home and content would be the way to reach out to these netizens, their target audience,” said Anirudh Singla, co-founder of Pepper Content, which engages with over 2,000 content-writers and designers.
“We have grown over 100% in revenue…,” he added.
There has also been a surge in demand for regional language content from startups and brands. “80% of vernacular content is usually outsourced,” Singla said.
Startups and traditional companies have already begun working with freelancers as they have embraced remote-working, experts said.
“Many companies, although they are laying off, are continuing to work with their employees as freelancers,” said Naman Sarawgi, founder of Refrens, a Bengaluru-based invoices and payment system firm for freelancers.
On average, billing for freelancers has increased over 20% compared to numbers in February, he added.
“Going forward, large businesses and startups are likely to continue specific roles with freelancers as these companies have now started building processes around it and managing these employees, which were not done so far,” Sarawgi said.
While this economy is likely to see a boost in the coming months, businesses around it, including payments and insurance, will also grow, experts said, adding that banks and insurance companies have been working on policies for freelancers and contractual employees.