Investigating barriers to digital platform adoption: A case of the South African township MSMEs

Abstract

The digital transformation of Micro, Small, and Medium Enterprises (MSMEs) holds significant potential to address the socio-economic challenges faced by South Africa’s township economy. Despite this potential, MSMEs in townships encounter barriers such as limited digital literacy, high platform costs, inadequate infrastructure, and cultural misalignment with digital tools. Anchored in the Technology-Organization- Environment (TOE) framework, this study explores the factors influencing digital platform adoption by township MSMEs. A multi-site qualitative case study approach was employed, using semi-structured interviews with MSME owners and managers across diverse township contexts in South Africa. The sample comprised varied enterprise types to capture a broad view of the challenges and enablers of digital platform adoption. Thematic analysis revealed that technological accessibility, organizational readiness, and environmental conditions including socio-cultural and language-related factors play critical roles in shaping digital adoption. The study makes four key contributions. Theoretically, it extends the TOE framework by highlighting the importance of cultural, language, and awareness-related factors in township digital adoption. Methodologically, it demonstrates the value of a multi-site interpretivist case design for exploring digitally constrained MSME environments. Contextually, it provides empirical insights into the lived realities of township entrepreneurs navigating digital transformation. Practically, it offers actionable guidance for policymakers, digital service providers, and ecosystem partners on designing more inclusive digital interventions. Overall, the findings underscore the need for targeted interventions that enhance digital literacy, reduce adoption costs, and align platform designs with the socio- cultural contexts of township MSMEs. Strengthening these areas can unlock the economic potential of digital platforms and support sustainable growth in South Africa’s township economy.