Digital literacy is a fundamental drive for the successful digital transformation of Small and Medium Enterprises (SMEs), particularly in traditional sectors such as Jakarta’s flower market. This study conducts a Systematic Literature Review (SLR) to examine the current state of digital literacy among SMEs, with specific attention to the challenges and opportunities facing flower sellers. By synthesizing findings from 30 peer-reviewed articles published between 2019 and 2023, the review identifies key digital competencies, adoption barriers, and policy recommendations. The results underscore the importance of contextualized digital training, mobile-first platforms, and public-private collaboration in empowering traditional market actors. This paper contributes a conceptual framework that can guide future digital literacy initiatives for SMEs operating in traditional urban markets. © 2025 IEEE.