COVID-19: Challenges and Opportunities for Small and Medium Enterprises (SMEs)

World has been grappling with corona virus, COVID-19 since December 2019. There are around 36 lakh confirmed cases and 2.5 lakh confirmed deaths in 215 countries as of May 2020 (WHO, 2020a). Recently discovered corona virus causes corona virus disease COVID-19. This new virus and disease were unknown before it spread in Wuhan, China, in December 2019. The impact of the pandemic can be seen across the sectors (Jones et al. 2020). The vulnerable sectors such as small and medium enterprises are already shown some symptoms, like closure or heavy loss due to lock down in many countries. Small and medium enterprises (SMEs) are characterized by limited financial and non-financial resources (Welsh and White, 1981). This makes SMEs more prone to the negative effects of environmental factors (d'Amboise and Muldowney, 1988; Welsh and White, 1981). SMEs often, have to adjust to the change in the business environment factors rather than directing them (d'Amboise and Muldowney, 1988). Sometime, the environmental factors become very adverse that it becomes difficult for the vulnerable sectors to remain robust. COVID-19 has created similar situation for the small and medium enterprises. There is no general definition of SMEs (Hooi, 2006; Omar and Ismail, 2009). There are different criteria used in different countries to define SMEs. Some of the variables used to define SMEs are size, total capital in firm, level of investment and turnover of sales (Bilal, et al. 2015). SMEs contribute in the development and growth of an economy. They help in creating jobs, making countries self-reliant, and also aid in effective use of resources (Ong et al., 2012). The present paper deals with the challenges and opportunities that COVID-19 provides to small and medium enterprises.