SINGAPORE (Mar 10): Technology has come a long way and weaved its way into businesses, helping them digitalise several tasks. This has made a lot of mundane work easier and saved companies a lot of time and resources.
However, small and medium enterprises (SMEs) in Singapore are still apprehensive about digital adoption and are not taking the necessary steps needed to strengthen their business’ infrastructure amid an increasingly digitised economy, according to the fifth edition of QBE Insurance’s annual survey of Singapore SMEs.
According to QBE’s research, SMEs said that they are keen to digitalise, but are put off by the high cost of investment. About 41% of respondents shared this sentiment, with the second most-cited reason being the lack of funds to do so.
However, the local government can play a part to help these SMEs, as 57% of SMEs said that support from the government is key to help lift the barriers to digitalising.
To be sure, Singapore’s latest 2020 Budget announced several packages and programmes to help SMEs access more working capital, and potentially further digitalise their businesses, such as the launch of the GoBusiness platform, a single touchpoint for enterprises to transact with the government digitally.
However, more needs to be done in outreach and education around these assistance measures. Despite the government’s efforts, only 31% of SMEs have utilised the government’s support available last year, while 71% were aware of these support measures. This shows that there is a perceivable gap between awareness and uptake.
Although SMEs are interested to digitalise, many seem unprepared to handle some of the business risks involved with technology usage. QBE’s research showed that 34% of SMEs expressed concern over unauthorised access into a system and 37% were worried about theft of sensitive data.
However, only 17% hold business insurance for unauthorised system access, while 19% have protection for information theft.
Nonetheless, SMEs are rather positive on the economy and their expansion plans, as 22% of respondents have the intention to internationalise, a 4% increase from the previous year.
“SMEs are the key driving force for Singapore’s economy. It is therefore critical for them to understand the importance of digitalising and scaling up to become more competitive in the marketplace. Assistance provided by the government, especially more so in the recent Budget announcement, should provide SMEs with the resources to establish proper contingency plans. This helps to ensure that their overall long-term growth is both sustainable and safe,” says Ronak Shah, CEO of QBE Insurance Singapore.
