Assessment of market systems for MSME digitalization for youth-led MSMEs

• Jul 30, 2025
• 1 min

Youth- and women-led MSMEs in Uganda continue to face structural challenges.This includes limited access to finance, high costs of digital devices, and low levels of digital literacy,  which hinder their growth and participation in the digital economy. To address these barriers, the United Nations Capital Development Fund (UNCDF), under its FinWise program, commissioned a market systems assessment to explore pathways to enhance digital and financial inclusion for youth-led MSMEs, in line with Uganda’s National Development Plan III.

MSC conducted the assessment, applying a multi-method research approach. The team led extensive desk reviews and fieldwork, which included 48 focus group discussions with MSME owners across sectors and 30 key informant interviews with stakeholders such as financial institutions, regulators, and policymakers. We analyzed the current digital transformation status of MSMEs, identified key barriers and gaps, and developed practical recommendations to address financing challenges, particularly related to digital devices and credit access. MSC also facilitated a validation workshop and shared findings with stakeholders to inform future interventions.

The assignment is expected to shape UNCDF’s technical assistance programs and provide practical insights for ecosystem players to unlock affordable device financing, improve digital access, and support youth-led business transformation. It ultimately aims to accelerate inclusive digital finance and contribute to economic resilience among young entrepreneurs in Uganda.

The United Nations Capital Development Fund (UNCDF) funded this project.