I set the permalink as shown below, and I also set the homepage to Product Category as shown in the image below, but the link is not working. What could be the reason?
Sorry to hear about the inconvenience. Kindly, please share your Site WP-ADMIN Login details in the Private Content field so that we can check this concern on your Site and help you out accordingly.
Your issue has been solved. You should not add the shop in the URL, I have deleted the shop from the URL. Now the product categories are linked perfectly. Please check the site after removing the browser cache.