Frugal Entrepreneurial Ecosystems and Alternative Finance in Emerging Economies: Pathways to Resilience and Performance and the Role of Incubators and Innovation Hubs

Abstract

Between 2018 and 2025, alternative finance expanded while micro-, small- and medium-sized enterprises in emerging economies continued to face a substantial funding gap. This study examines how entrepreneurial frugality articulates frugal ecosystems, access to alternative finance, resilience and SME performance within a single explanatory framework. Following PRISMA 2020 and PRISMA-S, we conduct a systematic review of Scopus, Web of Science and Cairn; out of 1483 records, 106 peer-reviewed studies are retained and assessed using the Mixed Methods Appraisal Tool and a narrative synthesis approach. The findings show that frugal ecosystems characterized by pooled assets, norms of repair and modularity, and lightweight digital tools reduce experimentation costs and develop frugal innovation as an organizational capability. This capability enhances access to alternative finance by generating readable quality signals, while non-bank channels provide a financial buffer that aligns liquidity with operating cycles and strengthens entrepreneurial resilience. The article proposes an operationalized conceptual model, measurement guidelines for future quantitative surveys, and public policy and managerial implications to support frugal and inclusive innovation trajectories in emerging contexts.