Bridging the Digital Divide: Infrastructure and Capability Barriers to SME Digital Platform Ecosystem Adoption in Developing Countries

Abstract

This research paper examines the digital divide as a significant obstacle that constrains the participation of Small and Medium-sized Enterprises (SMEs) in digital platform ecosystems in emerging economies. Despite recent research focusing on enhancing strategies for SMEs that are digitally capable, millions of SMEs are still excluded due to foundational access barriers. Employing systematic secondary data analysis methodology to evaluate international development reports and scholarly literature spanning 2019– 2025, the present study reveals a two-tier system where SMEs from developing countries encounter a phenomenon in which there are interconnected and reinforcing obstacles, given the inadequate internet infrastructure, the high technology costs, the insufficient digital literacy, and the lack of institutional support. The analysis shows that these obstacles act synergistically and lead to perpetuating cycles of digital marginalization. Results provide a comprehensive organizational framework of how infrastructure, financial, capability and institutional constraints sustain structural barriers of SMEs from digital economic opportunities. The authors offer actionable recommendations for integrated policy interventions to promote comprehensive digital transformations in developing countries. Keywords - Digital divide, SME development, digital platform ecosystems, developing countries, digital inclusion, infrastructure barriers