The Singapore Business Federation’s (SBF) National Business Survey (NBS) 2025 – Digitalisation Supplement reports that four in five businesses are actively engaged in digital transformation, with widespread adoption of foundational technologies such as e-payment, cloud computing and cybersecurity. Looking ahead, businesses are increasingly prioritising Artificial Intelligence (AI), data analytics and IoT as strategic enablers over the next 12 months.

Beyond AI (68%), usage of automation (56%) and cybersecurity concerns (55%) have emerged as the top three developments that businesses are most concerned with over the next 12 months. Despite this momentum, the proportion of companies viewing digital transformation as a top priority has declined — from 71% in 2024 to 58% in 2025 — amid a more challenging economic climate. The drop is more pronounced among large companies (from 85% to 60%) than among small and medium sized enterprises (SMEs) (from 68% to 57%).

Digitalisation Yields Clear Benefits, Though Cost and Human-Factor Constraints Persist: Businesses reported tangible benefits from their digitalisation efforts, including enhanced operational efficiency (45%), improved customer experience (44%), and stronger data-driven decision making (40%). 71% of businesses have taken steps to measure ROI of their digitalisation efforts, using t ime and cost savings as the key metrics. However, firms continue to face structural barriers. High cost of technology adoption (58%) remains the primary challenge, though this has fallen from 73% in 2024. Human-factor issues are increasingly prominent, including difficulty in upskilling employees (34%), low workforce interest (27%), and limited management expertise in driving organisational change (27%). Businesses highlighted financial support for digital advisory and implementation as the most impactful form of assistance to overcome these challenges.

AI, Data Analytics and IoT Lead the Next Phrase of Digital Adoption: More than half of businesses have implemented foundational digital solutions such as e-payments, cloud services, and cybersecurity. Over the next 12 months, the focus is expected to shift to more advanced capabilities, with AI (50%), data analytics (45%) and the Internet of Things (IoT) (39%) shaping the next stage of digital transformation. Current usage of AI is concentrated in areas such as productivity enhancement, content development, and data analysis. Adoption remains comparatively lower in customer facing roles, recruitment processes, and robotics. High cost of implementation (49%), lack of knowledge and expertise (48%), and concerns over data privacy and security (43%) are key challenges in AI adoption for businesses.

Cybersecurity Confidence Remains High, but Challenges Persist: While three in four businesses express confidence in their cybersecurity posture, large enterprises recorded a decline in confidence — from 94% in 2024 to 84% in 2025. SME confidence remains at 75%. Key challenges include the high cost of implementation (37%), lack of employee awareness (30%), and risks from third-party service providers (25%).

(Refer to Annexes for full details of SBF National Business Survey 2025 – Digitalisation Supplement)

Mr Kok Ping Soon, Chief Executive Officer of SBF, said, “Technology is no longer an add-on for Singapore businesses — it is the engine of competitiveness. As AI and data become central to business strategy, our focus must be on equipping firms with the skills, capabilities, and confidence to integrate the use of these tools deeply into their operations, not just superficial adoption. The challenge now is not whether to transform, but how fast and how effectively we can move. SBF will continue to champion the support companies need to accelerate this shift and position Singapore for the next decade of growth.”

Annex A: SBF National Business Survey 2025 – Digitalisation Supplement Key Highlights

Annex B: SBF National Business Survey 2025 – Digitalisation Supplement Company Case Studies

Annex C: SBF National Business Survey 2025 – Digitalisation Supplement Report

Annex D: SBF National Business Survey 2025 – Digitalisation Supplement Infographic