This study has explored the multifaceted landscape of digitalization within Micro, Small, and Medium Enterprises, highlighting both its transformative potential and the significant challenges that impede its equitable adoption. It has underscored that while digitalization offers unparalleled opportunities for efficiency, market expansion, and innovation for MSMEs, persistent barriers related to infrastructure, digital literacy, and financial constraints continue to marginalize a significant portion of these businesses. The analysis reveals that these disparities often perpetuate and, in some cases, exacerbate existing socio-economic inequalities, thereby creating a digital divide that extends beyond mere access to encompass skill, motivation, and effective utilization of digital technologies. The chosen methodological approach, a narrative literature review, offers a flexible yet rigorous framework for synthesizing diverse scholarly perspectives and empirical findings related to the digitalization of MSMEs.

Index Terms- Digitalization, Development, MSMEs, literacy, financial