Bridging the Gap to Circular MSMEs: A Systematic Literature Review on Sustainability Transitions, Digital Technologies, and Policy Support Mechanisms
DOI:
https://doi.org/10.70142/jbs.v2i02.128Keywords:
Circular Economy, MSMEs, Sustainability Transition, Digital Technologies, Policy SupportAbstract
This study presents a systematic qualitative literature review examining how Micro, Small, and Medium Enterprises (MSMEs) transition toward circular economy (CE) practices, with a focus on sustainability transitions, digital technologies, and policy support mechanisms. Drawing on peer reviewed studies published up to 2024, the review synthesizes key drivers, barriers, and enabling factors shaping circular adoption in MSMEs. The findings reveal that MSMEs face structural constraints such as limited financial resources, technological capabilities, and institutional support, which hinder large scale implementation of circular practices. However, digital technologies such as IoT, data analytics, and platform based systems emerge as critical enablers for improving resource efficiency and operational transparency. Additionally, coherent policy frameworks, including financial incentives and capacity building programs, significantly influence adoption outcomes. The study proposes an integrated ecosystem perspective, highlighting the need for alignment between technological innovation, policy intervention, and organizational readiness to accelerate circular transformation in MSMEs.
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