The $76 Billion Question: Why Are Kiwi SMEs Sitting Out the AI Revolution?

New Zealand’s first national Artificial Intelligence Strategy, launched in July 2025, marked a major step in the country’s digital journey. The strategy came with new Responsible AI Guidance for Businesses, aimed at helping organisations use technology more confidently.

For large companies, progress has been swift. Yet across the small business sector, adoption remains low. Despite growing awareness, most Kiwi SMEs are still unsure how AI fits into their operations.

That hesitation could mean missing out on one of the biggest productivity opportunities of the decade.

What’s driving the gap between large and small businesses?

The numbers tell a clear story. Around 67% of large New Zealand companies now use AI tools, while 68% of SMEs have no plans to adopt them. In Australia, the figure is closer to 38%.

Larger organisations are using automation to manage data, improve forecasting, and free up their teams for higher-value work. Many smaller businesses, meanwhile, remain cautious.

Common reasons include:

• Limited understanding of how AI fits into daily operations
• Concerns about cost or complexity
• Uncertainty about what tools actually deliver value

This gap is not about capability but rather about confidence. Most small businesses already use digital platforms that include automation features but haven’t explored them fully.

To see how other Kiwi businesses are taking small but powerful steps toward digital transformation, read our Success Stories

What’s at stake for New Zealand’s economy?

Economists estimate that AI could add $76 billion to New Zealand’s economy by 2038, the equivalent of a 15% lift in total GDP.

For small businesses, even modest digital improvements can deliver measurable gains. Studies show that every dollar invested in digital tools can return up to $3.10 in productivity value.

That productivity shows up as faster workflows, better forecasting, and improved margins — the kind of incremental gains that, over time, transform profitability.

The challenge isn’t access to technology. It’s knowing where to start, and doing so with confidence.

Where are businesses seeing results?

The most effective use cases are often the simplest. Businesses adopting automation in finance and operations are already seeing real returns.

Common applications include:

• Automating data entry, reconciliations, and invoicing
• Streamlining reporting and forecasting
• Analysing customer trends or inventory patterns

Xero’s AI-enabled platform, JAX, launched in 2025, has shown how automation can make daily accounting tasks faster and more accurate. The goal isn’t to replace people but to help them spend more time on meaningful work.

When used thoughtfully, technology becomes a tool for clarity, not complexity. Learn how our finance solutions can support your business as you adopt new systems or expand your capabilities.

Why are SMEs still waiting to act?

Many owners describe AI as something they’ll “get to later.” That mindset is understandable, especially in a tight economic environment, but waiting could widen the gap between businesses that adapt and those that fall behind.

Research shows that trust, not technology, is the real barrier. Most business owners want to see proven results before investing. Others feel overwhelmed by choice or uncertain about the return on investment.

That’s where practical guidance and the right financial structure can make all the difference.

Looking ahead: confidence through clarity

AI represents a clear opportunity for New Zealand’s business community. The question is no longer whether it will become essential, but how businesses can approach it responsibly.

For SMEs, the smartest move is to start small, focus on outcomes, and seek guidance that keeps technology aligned with strategy.

At Finance Link, we work with businesses across New Zealand to turn ideas into practical steps. Our role is to provide funding solutions that support innovation — helping you plan, act, and grow with confidence.

If you’re considering AI or digital upgrades, talk to our team about funding your next digital investment.

talk to us about funding your next digital investment.

How can small businesses start safely?

The best way to start is to identify one process that would make your week easier if automated. That might be invoicing, expense management, or customer reporting.

Most software used by SMEs already includes automation features. Start by exploring those before investing in separate systems. Measure the time saved, review the results, and build from there.

What role does finance play in digital adoption?

For many SMEs, progress depends on funding. Investment in new systems or training can improve long-term efficiency, but it needs to be structured carefully.

Finance Link helps business owners plan for digital transformation with clarity. Our team acts as a commercial financial adviser, guiding businesses through funding decisions and connecting them with suitable lenders for business loans or innovation support.

We focus on ensuring each financial decision supports sustainable growth rather than short-term fixes.

The aim is to help businesses take confident steps toward technology adoption, not leap blindly into it.

Explore our Finance Solutions to see how we can help you invest in smarter systems with confidence.

Do I need new funding to begin using AI?

Not necessarily. Many tools are already part of existing software subscriptions. However, if you plan to upgrade systems, invest in data tools, or train your team, structured business funding can help manage that process.

Finance Link can help you assess options that fit your business goals and cash flow.