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Emerging-Market Research Finds Digitization Alone Does Not Ensure Resilience

July 25, 2025 | 4 minutes reading time | By Anisha Sircar

Micro and small enterprises leapfrogged technologically, creating wealth and promoting financial inclusion. But regulatory guardrails and customer protections are uneven.

Technology made possible a flowering of small enterprises and supporting microfinance in emerging markets, but an extensive study reveals it has also brought risks ranging from cyber fraud to lack of recourse in the event of financial misconduct. These can be amplified by structural, regulatory and informational gaps.

The findings are from Small Firms, Big Impact: Digitization, Financial Services, and Climate Resilience in Five Emerging Markets by the Center for Financial Inclusion (CFI), a think tank hosted by the nonprofit Accion. The center sought to understand “the drivers of financial health” and provide “the clearest picture yet of the challenges and opportunities that determine the business trajectory” of micro and small enterprises (MSEs).

Enterprises that adopted digital payments and financial platforms were up to 10% more likely to report revenue growth than were those that did not. But the survey of 20,000 MSEs, along with more than 4,000 interviews, revealed adoption to be uneven across the five representative cities: Addis Ababa, Delhi, Jakarta, Lagos and São Paulo.

Digitization usage in Africa, for instance, is ...

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