Singapore’s SMEs are continuing to believe and invest in digital technologies, as the eighth edition of QBE Insurance’s annual research survey of SMEs finds.
However, these businesses are not tapping into support available to them, and not supplementing their digitalisation strategies with adequate protection measures.
The survey was conducted in Q4 2022 and surveyed 416 SME decision-makers in Singapore.
As businesses look to adapt to changing customer needs, QBE’s survey findings revealed that close to two thirds (66%) of SMEs have digitalised further over the past year. SMEs continue to invest in digital technologies as they believe that it helps them reach more customers (34%), helps their business grow (32%), and makes their business more productive (32%).
SMEs report growth in barriers to further digitalisation, yet not tapping into government support
Unfortunately, with the push and recognition of importance for digitalisation, SMEs have also reported a growth in barriers for further digitalisation. The survey found that over time, the top three barriers, namely high cost of investment (29%), lack of financing (27%) and lack of digital skills (24%) remain unchanged since 2017.
SMEs also indicated possible disruption to their business during implementation (23%), ensuring protection and security of data (21%) and finding digital technologies too complicated (21%) as further barriers to digitalisation.
Interestingly, government support packages and initiatives are available for SMEs to tap into, to help them overcome these specific barriers. The survey finds however, that SMEs are not taking advantage of these initiatives as much as they should – 89% indicate being aware of these support measures, but only 50% went on to apply for them in the past year.
Among the companies that applied for support this year, most indicated that the support they need from the government is for enterprise development programmes (46%), and financial support (45%).
SMEs show desire to further digitalise, but are not prepared for untoward cyber events, even as an increasing number report to have been affected by them
38% of SMEs reported to have been affected by cyber events in 2022, a significant increase from 26% in 2021. This despite 97% of them polling being either somewhat aware or fully informed of possible cyber risk to their businesses, and 21% of them being concerned about data protection and security. Despite this awareness, concern and incidence of cyber events, 9% of SMEs continue to operate without any process or protection against cyber risk.
39% of SMEs either would not consider or are on the fence about protection against cyber risk – an alarming statistic given the rate of digitalisation they are currently going through. The top two reasons for SMEs not to consider cybersecurity protection were the fact that they do not store personal/sensitive data online (54%) and they believe they are unlikely to encounter cybersecurity and/or cybercrime issues (50%).
“Digitalisation continues to be one of the main strategies for growth among Singapore SMEs. While we are fully onboard with their digitalisation journeys, we would also implore SMEs to consider their cyber risk exposures as they continue to plan for growth,” said Ronak Shah, CEO of QBE Insurance Singapore.
“While the business environment is poised to bring SMEs growth in the short-to-mid term, more awareness and education around adequate risk management and mitigation is needed to ensure growth is not just accelerated, but sustainable as well,” added Mr Shah.
