The Impact of Digital Economy on MSME Growth in Rural Areas: A Qualitative Study on E-Commerce and Fintech

Abstract

The digital economy, encompassing e-commerce and fintech, has transformed the landscape for micro, small, and medium enterprises (MSMEs), particularly in rural areas. This study explores how these digital tools impact the growth of rural MSMEs, focusing on their opportunities and barriers. Through a qualitative approach involving interviews, case studies, and secondary data analysis, the findings highlight the transformative potential of e-commerce in expanding market reach and fintech in providing accessible financing. However, significant challenges such as inadequate digital infrastructure, low digital literacy, and cultural resistance to adopting new technologies persist. The study reveals that while some MSMEs benefit from increased revenues and financial inclusion, many struggle to leverage these tools due to structural and educational barriers. Novel insights emphasize the need for tailored interventions, including improving digital infrastructure, targeted literacy programs, and trust-building measures. These strategies are critical for ensuring the inclusive growth of rural MSMEs and their integration into the broader digital economy. The research contributes a nuanced understanding of the rural context, offering actionable recommendations for policymakers and practitioners to bridge the digital divide and foster sustainable economic development.