European small businesses rush into AI without basic digital tools, study shows

Most European small and mid-sized enterprises are prioritizing artificial intelligence systems over basic digital tools across their businesses, losing ground to bigger firms investing in core digital systems, a study published on Wednesday showed.

Why it's important

While large corporations are steadily adopting AI software and scaling up investments, small businesses across Europe often lack relevant expertise and digital infrastructure.


Companies are turning to this technology to automate tasks and reduce costs across the board, resulting in job cuts which are shaking up entire industries.

The survey, conducted by French fintech Qonto, found that 46% of European SMEs use AI tools like ChatGPT daily but only a fraction of them implement digital accounting, video conferencing, data analytics or digital document management.

This inconsistency is causing a striking paradox that could threaten the future of Europe's economic backbone, Qonto says.

By the numbers

The report was conducted alongside research firm Appinio after interviewing 1,600 senior decision makers in France, Germany, Italy and Spain.

Two out of every five businesses feel unprepared for digital transformation, representing 10 million companies across Europe, according to the report.

Germany stands out with 76% of businesses feeling well prepared while France struggles with nearly half feeling inadequately equipped for the digital shift.

Key quote

"While AI offers exciting opportunities, we believe European businesses will have to build strong digital foundations that can support their long-term growth and innovation goals," said Qonto's Chief executive, Alexandre Prot.

What's next

The survey suggests targeted interventions could help close Europe's digital gap.

Reducing regulatory burdens in Germany, addressing skills shortages in Spain, and overcoming cultural resistance in France could strengthen competitiveness against better-equipped rivals increasingly using AI to slash costs and streamline operations.