DIGITAL INNOVATION AND ENTREPRENEURIAL SUCCESS IN THE PHILIPPINE MSME SECTOR: CHALLENGES AND OPPORTUNITIES

Abstract

While digital tools are becoming more accessible in emerging econ-

omies, MSMEs in the Philippines are still unable to adopt them. The

study aims to examine how digital innovation can help in the entre-

preneurial success of the Philippine MSME sector by identifying the

barriers and opportunities in digital adoption. Mixed-method approach

of surveying MSME owners and interviewing industry experts. The

survey was designed to determine how digital adoption. What types of

digital tools are being used, and what barriers are perceived. Data anal-

ysis used statistical methods and thematic analysis. The findings indi-

cate that while the MSMEs are becoming more digital embracing social

media marketing, digital payment systems, and other digital tools, they

have not leveraged the adoption of more advanced technologies such

as cloud computing and ERP systems. To identify the leading obstacles

to digital adoption, the first three were identified: cultural resistance,

lack of technical expertise, and financial constraints. Other issues that

prevent digital transformation from taking off in regional terms include

infrastructure and regulatory issues. The study highlights the need for

policy interventions and capacity-building programs, emphasizing

changes in digital adoption barriers facing MSMEs. It is suggested that

more access to digital tools at affordable prices, training, and raising

awareness on the importance of digital innovation. Further research on

longitudinal studies, industry-specific research, and cross-country re-

search will be needed to better understand the effect of digital adoption

on MSME performance.