The present digital world marks the Micro, Small and Medium Enterprises (MSMEs) the backbone of developing country’s economy. MSMEs contribute largely towards employment and GDP. The digital age has alarmingly reshaped the global markets posing both challenges and opportunities for MSMEs, thereby shaping their future in unprecedented ways. The prospects of digitalization paves way for the small businesses to access global markets, improve efficiency and enhance customer engagement through e-commerce, fintech solutions, AI and cloud-based technologies. Platforms like Amazon, Flipkart and ONDC provide MSMEs in various sectors of manufacturing, services, agriculturally based, trade and retail with opportunities to expand their business beyond local markets. However, MSMEs in developing countries face significant barriers to digital adoption in conduct of their business, including limited internet access, lack of digital literacy, cybersecurity risks and inadequate financial support. Besides, many small businesses struggle with high cost of technology, unreliable infrastructure and resistance to change. Governments and policymakers play a major role bridging this gap through digital training programs, infrastructure development and financial incentives. The future of MSMEs in the digital economy depends largely on their ability to innovate and adapt. Lastly, financial inclusion with right policies enables MSMEs to access credit, digital payment, banking services in digital age fostering sustainable growth, employment opportunities and economic resilience in developing countries.