Fungus spreads to your nail from underneath the skin. The liquid will not penetrate through the nail to get to the skin. Applying the liquid directly on your skin is effective for curing fungus. Fungus can spread to your cuticles, nail beds and even the nails themselves. If the nail is intact, meaning not cracked, the liquid may not be able to penetrate the hard nail which is why the package says that it is not effective on the nail.