Bridging the Digital Divide: Determinants of Technology Adoption Among Rural MSMEs

Abstract

Despite the far-reaching effects of the digital revolution on companies around the world, rural micro, small, and medium-sized businesses (MSMEs) still encounter obstacles when trying to implement digital technology. This study delves into the factors that impact the adoption of digital technology by rural MSMEs. Perceived usefulness, government backing, trust, and financial help are the main areas of attention. By means of a structured survey, information was gathered from 327 owners of MSME using an empirical method. The study used structural equation modelling (SEM) and exploratory factor analysis (EFA) to look for connections between the factors that were already established and the willingness to adopt. According to the results, government support has the least influence on digital adoption, followed by trust and financial aid, with perceived utility as the biggest predictor. Findings like these highlight the need of trust-building processes, financial incentives, and specific governmental interventions in getting rural MSMEs to embrace digitalisation. This research adds to what is already known about digital transformation by taking into account the contextual elements that impact the uptake of technology in developing economies.