Empowering MSMEs in The Digital Era: A Systematic Literature Review on The Role of Digital Literacy

Authors

  • Hermansyah Hermansyah Universitas Negeri Jakarta, Jakarta, Indonesia
  • Usep Suhud Universitas Negeri Jakarta, Jakarta, Indonesia
  • Mohammad Rizan Universitas Negeri Jakarta, Jakarta, Indonesia

DOI:

https://doi.org/10.38035/gijea.v3i2.385

Keywords:

Digital literacy, MSMEs Performance

Abstract

Introduction/Main Objectives: This study regularly examines the role of digital literacy in empowering MSMEs by exploring its impact on business performance, innovation, and sustainability. Background Problems: State the problem or economic/business phenomena studied in this paper and specify the research question(s) in one sentence. Novelty: Using a systematic literature review approach, this research identifies key challenges and opportunities MSMEs face in adopting digital technologies. Research Methods: Micro, Small, and Medium Enterprises (MSMEs) play a vital role in fostering economic growth at both global and local levels. In many countries, MSMEs significantly contribute to job creation, Gross Domestic Product (GDP) growth, and poverty reduction. However, despite their significant contributions, MSMEs often need help with structural and operational challenges that hinder their growth and competitiveness, particularly in the increasingly competitive digital era.  Finding/Results: Digital transformation offers substantial opportunities for MSMEs to enhance their operational efficiency, access broader markets, and increase productivity. Nevertheless, one of the primary obstacles to adopting digital technologies is the low level of digital literacy among MSME actors. Digital literacy, encompassing the ability to understand, use, and effectively leverage digital technologies, is a critical factor in the success of MSMEs in this era. Conclusion: Furthermore, the study highlights the importance of digital literacy training and supportive policies to bridge the digital gap and enhance MSME competitiveness in the digital economy. The findings provide insights and recommendations for policymakers and practitioners to develop strategies that support digital literacy development and empower MSMEs to thrive in the dynamic digital era.

References

Amggreni, R., & Muchran, M. (2023). The Role Of Financial Literacy, Digital Literacy, And The Influence Of Efficacy In Improving The Performance Of MSME Actors In Makassar City. International Journal of Economic Research and Financial Accounting (IJERFA), 1(4), 176–184.

Aminullah, E., Fizzanty, T., Nawawi, N., Suryanto, J., Pranata, N., Maulana, I., Ariyani, L., Wicaksono, A., Suardi, I., Azis, NLL, & Budiatri, AP (2024). Interactive Components of Digital MSMEs Ecosystem for Inclusive Digital Economy in Indonesia. In Journal of the Knowledge Economy (Vol. 15, Issue 1). https://doi.org/10.1007/s13132-022-01086-8

Athia, I., Soetjipto, BE, & Efendi, E. (2023). THE IMPROVEMENT OF MSMEs' BUSINESS PERFORMANCE DURING THE COVID-19 PANDEMIC THROUGH FINANCIAL AND DIGITAL LITERACY. Journal of Economics, Business and Entrepreneurship, 12(1), 92–109. https://doi.org/10.26418/jebik.v12i1.58984

Diptyana, P., Rokhmania, N., & Herlina, E. (2022). Financial Literacy, Digital Literacy and Financing Preferences Role to Micro and Small Enterprises' Performance. IJEBD (International Journal of Entrepreneurship and Business Development), 5(2), 346–358. https://doi.org/10.29138/ijebd.v5i2.1785

Judijanto, L. (2024). Taxation Policy and Compliance Burden on MSMEs: An In-depth Legal Study in Indonesia. International Journal of Business, Law, and Education, 5(2), 1597–1504. https://doi.org/10.56442/ijble.v5i2.618

Melillanca, E., Ramírez, M., & Forcael, E. (2023). Model of Key Factors in the Sustainable Growth of Small and Medium-Sized Enterprises Belonging to the First Nations. Sustainability (Switzerland), 15(11). https://doi.org/10.3390/su15118822

Munthe, RA, Pratikto, H., Sudarmiatin, & Restuningdiah, N. (2024). The Impact of Entrepreneurial Leadership, Business Environment, Digital Literacy, and Religiosity on MSME Performance: The Mediating Role of Innovative Behavior in Pekanbaru. Journal of Ecohumanism, 3(8), 139–149. https://doi.org/10.62754/joe.v3i8.4717

Mushtaq, N., Hussain, F., Dad, A., Rehman, S.U., & Waseem, M. (2024). Digital Transformation and Its Impact on Business Performance in SMEs of Pakistan: An Empirical Study. The Asian Bulletin of Big Data Management, 3(2), 103–114. https://doi.org/10.62019/abbdm.v3i2.92

Nur Samsul Bahri, NSB, Muhammad Rakib, Muhammad Ihsan Said Ahmad, Rahmatullah, & Muhammad Hasan. (2021). The Influence of Digital Literacy and Entrepreneurial Behavior on Small Business Performance (Study on Culinary Business in Jeneponto Regency). Daengku: Journal of Humanities and Social Sciences Innovation, 1(2). https://doi.org/10.35877/454ri.daengku582

Nurlina, N., Del Rosa, Y., & Yanti, B. (2023). The Effect Of Digital Literacy And Business Strategy On The Performance Of Micro, Small, And Medium Enterprises (MSMEs) In Culinary Industry In Padang City. International Journal of Progressive Sciences and Technologies, 38(2), 252. https://doi.org/10.52155/ijpsat.v38.2.5291

Patria, H., Fatchul Alam, MA, Mulyadi, A., & Setyarko, A. (2023). The Influences of Digital Technology, Digital Literacy, and Digital Marketing on the Performance of SMEs in Bekasi. IMWI Repository Horizon, 6(1), 401–419. https://doi.org/10.52851/cakrawala.v6i1.235

Putra, AT, Inanna, Tahir, T., Mustari, & Hasan, M. (2023). Analysis of Financial Literacy and Digital Literacy on the Sustainability of Micro, Small and Medium Enterprises (MSMEs). International Journal of Asian Business and Management, 2(6), 977–992. https://doi.org/10.55927/ijabm.v2i6.6978

Queiroz, G. A., Alves Junior, P. N., & Costa Melo, I. (2022). Digitalization as an Enabler to SMEs Implementing Lean-Green? A Systematic Review through the Topic Modeling Approach. Sustainability (Switzerland), 14(21), 1–21. https://doi.org/10.3390/su142114089

Rosyidiana, RN, & Narsa, IM (2024). During the post-pandemic economic recovery period, micro, small, and medium-sized enterprises (MSMEs): digitalization, literacy, innovation, and its impact on financial performance. Cogent Business and Management, 11(1). https://doi.org/10.1080/23311975.2024.2342488

Rvspk, R., Hms, P., & Rgn, M. (2020). Digital Literacy, Business Uncertainty & Economic Performance: An Empirical Study of Small Businesses in Sri Lanka. International Journal of Academic Research in Business and Social Sciences, 10(5). https://doi.org/10.6007/ijarbss/v10-i5/7171

Sari, Dewi Maya Rifani Ahmad. (2022). RJOAS, 11(131), November 2022. 11(November), 51–59. https://doi.org/10.18551/rjoas.2022-11.06

Sinaga, KN (2024). Analyzing the Influence of Entrepreneurship. 4(5), 936–949.

Sitaniapessy, RH, Latupapua, CV, Lewaherilla, N., Leuherry, F., Ferdinandus, SJ, Asnawi, A., & Pentury, G. (2024). The Advantages of Digital Literacy Strategies to Improve MSME's Business Performance. European Journal of Theoretical and Applied Sciences, 2(1), 504–512. https://doi.org/10.59324/ejtas.2024.2(1).43

Sudadi Pranata, Umi Narimawati, & M. Yani Syafei. (2024). Content Marketing, Social Media Marketing and Search Engine Optimization (SEO) on Successful Business Performance in Msmes in Cirebon City with Digital Literacy as an Intervening Variable. Journal of Economic Management Research (REKOMEN), 7(1), 272–283. https://doi.org/10.31002/rekomen.v7i1.1426

Suyanto, B., Sugihartati, R., Egalita, N., Mas'udah, S., Singgih, DS, & Sudarso. (2023). Digital literacy and survival mechanism of micro-small enterprises in the practising sharing economy. Cogent Social Sciences, 9(2). https://doi.org/10.1080/23311886.2023.2245691

Ta, V. A., & Lin, CY (2023). Exploring the Determinants of Digital Transformation Adoption for SMEs in an Emerging Economy. Sustainability (Switzerland), 15(9), 1–13. https://doi.org/10.3390/su15097093

Umboh, IA, & Aryanto, VDW (2023). Digital Marketing Development Model through Digital Literacy Mediation to Improve SME's Performance. Media Ekonomi Dan Manajemen, 38(1), 94. https://doi.org/10.56444/mem.v38i1.3315

Wardana, LW, Ahmad, Indrawati, A., Maula, FI, Mahendra, AM, Fatihin, MK, Rahma, A., Nafisa, AF, Putri, AA, & Narmaditya, BS (2023). Do digital literacy and business sustainability matter for a creative economy? The role of entrepreneurial attitude. Heliyon, 9(1), e12763. https://doi.org/10.1016/j.heliyon.2022.e12763

Widiastuti, E., Kurniasih, R., & Martini, S. (2021). Can Digital Literacy Increase SME's Performance? An Evidence from SME in Banyumas. International Sustainable Competitive Advantage, 11(1), 130–139. http://jp.feb.unsoed.ac.id/index.php/sca-1/article/view/2769

Published

2025-06-03

How to Cite

Hermansyah, H., Suhud, U., & Rizan, M. (2025). Empowering MSMEs in The Digital Era: A Systematic Literature Review on The Role of Digital Literacy. Greenation International Journal of Economics and Accounting, 3(2), 185–196. https://doi.org/10.38035/gijea.v3i2.385

Most read articles by the same author(s)