Blockchain Adoption, Consumer Trust, and Loyalty in Retail SMEs: Evidence from Southeast Nigeria.

Abstract:

In the digital economy, consumer trust is increasingly recognized as a decisive factor for the survival and growth of Small and Medium Enterprises (SMEs). This study investigates how blockchain technology can strengthen consumer trust and loyalty in Nigerian SMEs, thereby enhancing business sustainability and competitiveness. Drawing on theories of trust, transparency, and dynamic capabilities, the research employed a mixed-methods approach, combining survey responses from 250 SME owners and consumers in South East Nigeria with qualitative interviews from industry experts. The findings reveal that blockchain-enabled systems significantly enhance perceptions of security, authenticity, and accountability, which in turn foster stronger consumer loyalty and brand confidence. Furthermore, SMEs that adopted blockchain-based loyalty programs and transparent transaction systems reported higher customer retention and repeat patronage. However, challenges such as infrastructural deficits, regulatory ambiguity, and low digital literacy remain major obstacles to adoption. The study concludes that blockchain is not merely a technological innovation but a strategic enabler for trust-building and SME resilience in turbulent business environments. It recommends targeted government support, digital literacy campaigns, and collaborative partnerships between SMEs, fintech firms, and regulatory bodies to accelerate blockchain integration. This paper contributes to the growing body of literature on digital trust and offers practical implications for entrepreneurs and policymakers in Nigeria’s evolving market ecosystem.