Digital tools a must for enterprises, says head of Islamic development fund

By Gokhan Ergocun

ALIGERS, Algeria (AA) - Micro, small and medium-sized enterprises (MSMEs) are not able to be competitive and to reach markets or financing without basic digital tools such as online sales, artificial intelligence (AI) and cyber security, the director general of the Islamic Solidarity Fund for Development said Monday.

They are the backbone of local economies by driving employment and innovation, but they are encountering significant hurdles in five key areas: access to finance, capacity development, market access, policy and regulatory frameworks, and technology adoption, Adil Alsharif said during the Islamic Development Bank Group’s annual meeting in the capital of Algeria.

The four-day event, starting on Monday, serves as a high-level strategic platform to enhance development cooperation and knowledge exchange.

"The vulnerable institutions can work with governments in providing such training for digital tools. It is not a luxury anymore, it is a reality," he said.

MSMEs often struggle to secure affordable financing, and development institutions can help by establishing Islamic microfinance and small-to-medium funds, de-risking lending through guaranteed funds, and collaborating with governments to create lending frameworks that attract private investment, he noted.

He stressed that while MSMEs excel in their products, they often lack business management skills.

Institutions can provide training in business planning, market strategies, contract management, sales and digital solutions, he said, adding that support for accelerators and incubators can further enhance MSME sustainability through financing and mentorship.

He noted that limited market exposure restricts MSME growth, but development institutions can connect MSMEs with international organizations and large companies while promoting digital solutions like e-commerce platforms to expand their reach regionally and globally.

Bureaucratic hurdles such as complex registration and licensing processes discourage MSMEs, he said, adding: “When they started, they faced a bureaucracy, and this might discourage them when they want to go for registration or for applying for the licenses and so on.”

He highlighted that in a competitive global market, MSMEs often lack access to affordable technology.

Development institutions can support the adoption of digital tools such as e-commerce platforms and operational applications to improve efficiency and global exposure, he added.