In Industry 5.0, the new paradigm is a movement of separation between manufacturing this is highly automated and shifting to the new model of sustainable, robust, and human-centered manufacturing which involves integrating higher levels of automation alongside human imaginative and dexterious skills. Small and medium-sized businesses (SMEs) find Industry 5.0 presents opportunities to become more competitive, personalise products, minimise environmental impact, and enhance worker welfare, however, there are more down-to-earth challenges such as lack of financing, digital skills, outdated systems, and unpredictable incentives in regulation. The paper provides the synthesis of recent literature by (1) defining the Industry 5.0 paradigm in relation to SMEs; (2) overviewing significant technological, organisational, and policy challenges and opportunities (3) deducing a structured, stage-would roadmap of its adoption that corresponds to SME constraints; and (4) finding out the practical limitations and future research directions. The paper is also meant to be a brief practical guide to the SME managers, cluster organisations and the policy makers intending to plan on transitional strategy towards Industry 5.0.