New research has revealed that 58 per cent of UK small and medium-sized enterprises (SMEs) do not use cloud-based computing.

In total, a third of SMEs stated that they do not use the cloud at all, while a quarter are not currently using the technology, but plan to implement it in the next 12 months.

Close Brothers commissioned GMI to survey 896 SME owners and business managers from a variety of industries across the UK and Ireland in April, finding that of those not using the technology, over a third of companies (36 per cent) do not trust that it is secure enough. A further 29 per cent believe that transferring to the cloud would be too time intensive, and 16 per cent said that they cannot afford to invest in it.

Three quarters of SME senior business decision makers (73 per cent) said they do not understand cloud technology, with 10 per cent admitting they did not know what it is.

Smaller enterprises were the least likely to be familiar with business clouds. In companies with an annual turnover of less than £250,000, 14 per cent claimed they understand the technology well. In comparison, in firms with a turnover of over £5 million, 45 per cent said they do.

However, firms of all sizes recognised the value of using the cloud for business. The top reasons SMEs would consider adopting the technology are to enable flexible working (29 per cent), to save space (28 per cent) and to improve organisation (25 per cent).

David Thomson, chief executive of Close Brothers Invoice Finance, said: “SMEs appear to still be at the early stages of adopting cloud technology, but these businesses could gain the most.

“However, while this technology has the potential to enhance operations, it is important to make an informed decision when choosing how to use internet-based applications – businesses should remain alert regarding IT security and sharing sensitive information,” he added.

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