Norfolk businesses are being urged not to miss out on the benefits of artificial intelligence
The Federation of Small Businesses says concerns about security, copyright and legal liability remain.
Last updated 19th Jun 2026
More than half of small businesses are now using artificial intelligence, but the Federation of Small Businesses says concerns around security, legal liability and the misuse of intellectual property could prevent the technology from reaching its full economic potential.
New research from the business group found AI adoption among small firms has almost tripled in just two years, rising from 20 per cent in 2023 to 55 per cent today.
The study also found 59 per cent of businesses using AI reported improved productivity, while almost one in four said it had helped increase revenue.
However, confidence in the technology is failing to keep pace with adoption.
The Federation of Small Businesses (FSB) found 92 per cent of small firms now have concerns about the risks associated with AI, compared with 73 per cent in 2023.
Among the biggest concerns are inaccurate responses, security risks, copyright issues, a lack of transparency around how AI models are trained and uncertainty over legal responsibility when mistakes occur.
"Add more than £42 billion to the UK economy each year"
Candy Richards, Development Manager for the Federation of Small Businesses in Norfolk, said the speed at which AI has become embedded within small businesses had been "quite staggering".
"AI has only really sort of been with us for about three years, but the impact on our everyday lives and the workplace is so significant," she said.
"It's quite staggering really the way that AI has been embraced by small businesses.
"About 55 per cent of small businesses now use AI technology within their business and that is up from just 20 per cent in 2023."
Ms Richards said the technology was already delivering measurable benefits for many firms.
"What businesses are also highlighting to us is that around 59 per cent of businesses using AI have improved productivity, but crucially, nearly one in four is seeing higher revenue when they are embracing AI," she said.
The FSB estimates that wider adoption and deeper use of AI could add more than £42 billion to the UK economy each year.
Locally, businesses are already finding innovative ways to use the technology.
Ms Richards cited examples including a drinks producer using AI to create a virtual bartender on its website, a property surveyor using it to summarise complex reports and a photographer using AI-generated voiceovers in video content.
"There is huge opportunity and really interesting ways that small businesses are embracing this technology," she said.
Concerns remain
Despite the optimism, the research suggests many businesses remain uneasy about how AI is regulated and how their information may be used.
"We have also seen a massive spike in the number of small businesses telling us that actually they're really concerned around the risks involved in using AI," Ms Richards said.
"Our research shows that a whopping 92 per cent of small businesses have real concerns around AI."
One of the major issues raised by business owners is uncertainty over intellectual property rights.
The FSB is calling for stronger protections against AI companies using copyrighted content without permission when training their systems.
"For people who are creating brilliant content or work that is original, there is real fear around AI using this content without their permission," Ms Richards said.
"We must see stronger enforcement against AI companies where this isn't happening."
The organisation is also calling for standardised "model cards" that would clearly explain how AI platforms use and store data, as well as clearer rules around liability when AI-generated information is incorrect.
Ms Richards said businesses need confidence before they can fully embrace the technology.
"There is a big gap between those businesses who are using AI and those who are using AI with confidence," she said.
"If we know that productivity can be driven up and revenue could increase with more businesses using AI, we have to bridge that trust gap."
Seeking greater regulation and clarity
The FSB argues that without greater clarity and regulation, some businesses may delay adoption altogether, limiting both productivity gains and wider economic growth.
"The reality is that we've got an ever-increasing number of businesses using AI, but there is a big gap between those businesses who are using AI and those who are using AI with confidence," Ms Richards said.
"That will only happen when we see that legislation and framework coming in and giving small businesses the confidence to use AI and know all the data that they're putting in will be used responsibly."
The Federation of Small Businesses surveyed 904 small business owners across the UK between November 11 and November 24, 2025.