From automating payments to fraud prevention: How SMEs can make AI work for them

The adoption of artificial intelligence (AI) among small and medium-sized enterprises (SMEs) in Singapore has more than tripled between 2023 and 2024 – but enthusiasm does not always equal readiness.

At a recent SME-focused roundtable by Mastercard in Singapore, industry experts noted that while many small businesses recognise AI’s potential to boost productivity and security, few have a clear roadmap for applying it effectively.

“Our SME clients are really excited about AI, but when we ask how they actually want to use it in their business, most say they’re not quite sure yet,” said Vineet Agarwal, head of GXS Capital, during the session.

The roundtable brought together regional and global SME leaders from Mastercard, banks and fintech companies to discuss how AI can deliver the most practical benefits – from reconciling invoices and tracking payment deadlines to protecting SMEs from potential cyberthreats.

Across Asia Pacific, AI adoption is accelerating, with the Mastercard Economics Institute reporting rapid increases in card spending on AI services and subscriptions.

Business owners are no longer waiting for innovation to trickle down from large enterprises. They are actively seeking practical, personalised AI tools to automate tasks, drive real-time decision-making and enhance business security.

Mark Barnett, global head of Small and Medium Enterprises at Mastercard, said: “Small business owners want to get on with what they do best: running their business.

“If they are a coffee shop, they just want to make great coffee. If they own a book store, they just want to curate a unique book selection for their community. AI can take some of the challenges out of day-to-day business management and is truly helpful when it frees up an SME’s most valuable resource: time.”

Jaya Kapur, vice-president of Product at Nium, added: “For instance, when working with multiple suppliers, SMEs can use AI for real-time visibility and greater transparency into their cross-border payments for better supply chain control.”

Developing digital defences

In addition to improving cash flow management, AI offers tangible benefits in cybersecurity, particularly in detecting and preventing cyberfraud.

Globally, 46 per cent of SMEs have experienced a cyber attack and almost one in five of affected SMEs subsequently filed for bankruptcy or closed their business.

According to Coco He, head of Global Institutions at Sunrate, AI’s ability to detect and prevent fraud quickly is one of its strongest selling points for both consumers and businesses.

“If we can show SMEs how AI can reduce fraud rates, business owners are happy to adopt AI solutions for their specific needs,” she said. “We can predictively identify highly suspected fraud merchants and save businesses potentially huge losses in both money and time.”

While AI is proving its worth in operations and cyber security, it also holds promise in more creative areas of business — such as marketing and customer engagement.

With AI-powered tools, SMEs can design topical campaigns that resonate with audiences, optimise their content for new search engines, such as language-learning models, and get more value from their advertising spend.

Trusted tools for tech transformation

Whether it is managing payments, preventing fraud, or improving marketing efficiency, the best AI solutions work quietly in the background – streamlining workflows and removing friction from daily operations.

Though given the complexity of developing AI systems, much of the innovation will come from larger organisations. For many SMEs, AI will be technology they use rather than build – integrated into the banking and payment platforms they already trust and rely on.

But who drives this integration – corporates embedding AI into the products they push, or SMEs demanding smarter solutions? Roundtable participants agreed it is a push-pull dynamic that will shape the pace and depth of AI adoption, with the “pull” from SMEs likely determining how banks and fintechs deliver AI-based solutions.

It is clear that no single organisation can develop or deliver these solutions alone. For SMEs to benefit from AI, close collaborations between technology providers, financial institutions and fintech innovators are essential.

Sumit Khurana, senior vice-president of Small and Medium Enterprises, Asia Pacific, at Mastercard said: “Through strategic collaborations with banks and fintechs, we are helping SMEs digitise supply chains and payment processes.

“It’s no longer just about getting business owners online but making sure they are equipped with the right digital AI tools and know-how for sustainable growth.”

Find out more about how SMEs can explore solutions tailored for their business needs here – from cyber security to cash flow management.