Abstract: This study examines the persistent disconnect between MSME support interventions and entrepreneurial outcomes among women in Nigeria, where increased access to finance, training, and market linkages has not translated into improved firm performance. Drawing on capability-based and contingency perspectives, the study investigates whether digital literacy mediates the relationship between MSME support mechanisms and women’s entrepreneurial development. Using survey data from 600 women-owned MSMEs and Partial Least Squares Structural Equation Modelling (PLS-SEM), the findings reveal that MSME support mechanisms have no significant effect on business performance (β = −0.020, p = 0.748) and do not significantly influence digital literacy (β = −0.070, p = 0.492). Additionally, digital literacy does not significantly affect business performance (β = 0.024, p = 0.571) and does not mediate the relationship between MSME support and entrepreneurial outcomes. However, digital literacy exerts a significant negative effect on personal empowerment (β = −0.096, p = 0.004), while MSME support shows no significant influence on empowerment outcomes. The study concludes that MSME support mechanisms and digital literacy are insufficient to drive entrepreneurial outcomes in structurally constrained environments such as Nigeria and comparable developing economies. It highlights the need for integrated, ecosystem-based interventions that align entrepreneurial capabilities with enabling institutional and infrastructural conditions.
AKINKUOLIE et al. (Tue,) studied this question.