Studies in Indian Place Names (UGC Care Journal) ISSN: 2394-3114 Vol-40-Issue-56-March -2020 Page | 940 Copyright ⓒ 2020 Authors Substantial Effect of Digital Banking in the Growth of MSMEs in India (A Case Study of Katihar District in Bihar) Bharat Kumar Meher Assistant Professor, Department of Commerce, D.S.College, Katihar, (Under Purnea University, Purnia), India-854105 Email ID : bharatraja008@gmail.com ORCID : https://orcid.org/0000-0002-7264-5882 Abhishek Kumar Gupta Assistant Professor, Department of Commerce, D.S.College, Katihar, (Under Purnea University, Purnia), India-854105 Email ID : abhishekkrgupta16@gmail.com ________________________________________________________ Abstract The evolution of digital banking has changed the face of the whole banking sector of India. The customers who were previously waiting in a long queue in banks just to withdraw money to use hard cash for the purpose of payments, to transfer the money to a distant person through NEFT or RTGS and sometimes to update the passbook to know their present bank balance, are now using digital banking and doing all such banking transactions with a mere click of mouse or with a mere touch of finger on their cell phone. The era of digital banking also known as internet banking, e-banking or online banking has been first offered by ICICI in the year 1996, and only thereafter the other banks also used to provide this facility. Digital banking not only facilitates the consumers but also benefited a lot to the businesses. This paper is an attempt to study the effect of the digital banking on the business activities of MSMEs (Micro Small and Medium Enterprises) in the state of Bihar. The MSME sector has been considered because India’s MSME base is the largest in the world after China. The sector provides a wide range of services and is engaged in the manufacturing of more than 6000 products ranging from traditional to hi-tech items. The reason for taking the state, Bihar, is that it has highest number (7,70,871) of registered MSMEs followed by Uttar Pradesh (5,96,036) Delhi (5,88,483), Maharashtra (5,70,101) and Gujrat (4,86,080). The study covers the benefits MSMEs while using digital banking. Moreover, it also includes the impact of digital banking on the sales and ease in doing business of MSMEs.