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This paper seeks to construct a theoretical framework to understand better crowdfunding, its applications, and its impact on the progression of start-ups and small and medium-sized enterprises (SMEs). Researchers have investigated the origins and consequences of financing through crowdfunding in start-ups and SMEs thus far. Lack of funding to launch, maintain, and expand firms is one of the most significant obstacles to small and medium enterprises' success. Higher rules and prudential standards by financial institutions, combined with the global financial crisis of 2007–2008, significantly reduced credit supply to start-ups and SMEs. Crowdfunding is a group effort that enables business owners to obtain cash from numerous individual sources via online platforms. This article explores the growth of crowdfunding within the Indian context, consolidating various scholarly studies focusing on advancements in funding for start-ups and Small and Medium Enterprises (SMEs). Furthermore, it delves into how much crowdfunding has provided financial assistance to these entities. The article aims to highlight to researchers and policymakers the necessity of enhancing the structure to achieve balanced development between conventional and alternative economic systems.
Arora et al. (Mon,) studied this question.