Singapore’s small and medium-sized enterprises (SMEs) are bracing for a challenging 2025, with artificial intelligence (AI) and cyber risks at the forefront of their concerns, according to QBE Insurance’s annual SME survey. Conducted between December 2024 and January 2025, the survey gathered insights from 600 decision-makers on business risks and opportunities.
The survey highlights that two-thirds of respondents cite increased costs and reduced profitability as their primary challenges, a significant rise from the previous year. Additionally, over half of the SMEs are grappling with reduced customer spending and financial difficulties. To counter these challenges, many are turning to AI to enhance productivity, with 52% acknowledging its significant impact.
However, the enthusiasm for AI is tempered by concerns over its risks. A notable 34% of respondents view AI as a threat to business activity, up from 30% last year. Privacy and security concerns related to AI have also surged, with 66% worried about privacy issues and 51% about security breaches.
Cyber risks remain a critical issue, with only 40% of SMEs feeling fully informed about these threats, a decline from the previous year. Despite an increase in cyber events, spending on cyber insurance has decreased, with only 36% of businesses covered.
Ronak Shah, CEO of QBE Singapore, emphasised the importance of adapting workforces to AI, stating, “The proliferation of AI is not about replacing people with machines but rather about adapting our workforces to meet this new paradigm.”
As SMEs navigate these challenges, the survey underscores the need for tailored insurance solutions and a balanced approach to technology adoption.
This news story was carefully selected and published by a human editor, though the content itself was AI-generated. If you spot an error, please report it here.
