Digital Gaps in Cambodia: Why MSMEs Struggle and What Can Drive Inclusive Adoption

Cambodia’s MSMEs show highly uneven digital adoption, with microenterprises, especially women-owned firms, constrained by limited skills, financing gaps, weak information networks, and inadequate infrastructure. Addressing these structural barriers is essential to ensure inclusive digital transformation and prevent widening economic inequality.

Cambodia’s micro, small, and medium-sized enterprises (MSMEs) are navigating a pivotal moment in their digital transformation, as revealed in a comprehensive study by the Cambodia Development Research Institute (CDRI) and the Asian Development Bank (ADB). Drawing on a survey of 414 MSMEs across three major economic centers and dozens of stakeholder interviews, the study highlights how business size, gender dynamics, financial access, and structural constraints are together shaping an uneven digital landscape across the country.

A Deepening Divide in Digital Adoption

The report shows that while mobile-based payment systems, particularly KHQR, have become widely adopted across firms, other essential functions remain largely analog. Microenterprises continue to rely on handwritten notes and manual processes for quality control, supply planning, and business administration. The data and charts in the brief underscore how smaller firms rely almost exclusively on smartphones and mobile internet, limiting their ability to integrate more sophisticated tools. Meanwhile, small and medium-sized enterprises demonstrate significantly higher ownership of laptops, desktops, printers, QR code readers, and point-of-sale terminals, enabling them to digitize core business operations more effectively.

Gender Gaps Rooted in Structure, Not Technology

One of the most striking insights from the study overturns familiar assumptions: women entrepreneurs do not lag behind men due to lower digital aptitude. When firms of comparable size are examined, men and women adopt digital tools at similar rates. The gender gap instead reflects structural factors, women disproportionately operate microenterprises with fewer resources, weaker market networks, and lower access to formal finance. Yet even within these constraints, women-led microenterprises outperform men in areas like mobile payments, online sales, and social media engagement. Their underrepresentation in business associations, however, restricts access to reliable information channels and limits exposure to new digital solutions.

Skills, Aspirations, and the Economics of Adoption

Skill shortages are a significant obstacle across all MSMEs. Very few enterprises invest in employee training, and owners devote minimal time to personal skill development. Women microentrepreneurs, carrying heavier care burdens due to entrenched gender norms, spend even less time than men on learning opportunities. Interviews included in the brief describe how domestic responsibilities often take precedence, making formal training inaccessible for many women business owners.

Economic incentives also influence digital uptake. Microenterprises frequently perceive limited financial benefits from adopting new technologies, especially when their customers remain offline or uninterested in digital interactions. Without clear demand or immediate efficiency gains, owners hesitate to invest in new systems that require money, time, and operational adjustments. SMEs, by contrast, experience more tangible returns from digital tools in administration and production planning, making adoption more appealing.

Aspirations further shape digital readiness. While 90% of medium-sized enterprise owners plan to expand in the next five years, only about half of microenterprise owners express similar ambitions, and some expect to scale down or exit the market. A lack of a growth-oriented mindset dampens the willingness to invest in digital technology.

Finance, Infrastructure, and Cyber Risks as Hidden Barriers

Access to finance remains a defining factor in digital adoption. Over 60% of SMEs have formal loans, compared to less than half of microenterprises. Women owners of micro and small firms are notably less likely than men to access such loans and more reliant on microfinance institutions than commercial banks. Limited financial literacy and fear of default compound these challenges, discouraging many from seeking the formal credit needed for digital investment.

Beyond financing, rural firms face unreliable electricity and unstable internet connectivity, making it difficult to integrate or consistently use digital tools. At the same time, cybersecurity risks are expanding faster than MSME awareness. Many small business owners lack an understanding of online threats and how to protect themselves, exposing them to increasing vulnerabilities as their digital footprint grows.

A Critical Moment for Inclusive Digital Transformation

The brief makes clear that Cambodia’s digital transition is not unfolding evenly. It is shaped as much by resources, networks, and market incentives as by attitudes and gender norms. Without strategic, coordinated interventions spanning skills development, financial literacy, infrastructure improvements, and targeted support for women entrepreneurs, the digital divide risks widening further. As Cambodia moves deeper into a technology-driven economic era, ensuring that microenterprises, and especially women-led firms, are not left behind will be essential for building a resilient and inclusive digital economy.