By Andrew Maren, Founder and CEO of ProfitShare Partners
In South Africa’s fast-paced and constantly evolving business landscape, small, medium and micro enterprises (SMEs) are often celebrated as the lifeblood of the economy. But despite their vital role, access to funding continues to be one of the greatest obstacles standing in the way of their growth. Startlingly, only about 15% of the country’s estimated three million SMEs have access to formal credit.
This is where artificial intelligence (AI) is proving to be a game-changer. Once the preserve of cash-flush corporates, AI is now levelling the playing field. More SMEs are tapping into AI-driven tools that help them leapfrog the traditional barriers to finance. And as digital adoption accelerates, the divide between the tech-ready and the tech-resistant is becoming more pronounced. Businesses that shy away from AI risk being left behind.
A Catalyst for SME Growth
Globally, AI is expected to contribute a staggering $ 15.7 trillion to the economy by 2030. A significant portion of that growth is tied to the productivity boosts that smaller businesses can harness. In essence, AI helps SMEs become “funding-ready” by offering a smarter, faster way to showcase their potential. By analysing real-time financial data, transactional patterns, and applying predictive analytics, AI systems can assess the creditworthiness of a business far more effectively than outdated, manual processes. For fintechs and alternative funding providers, this means quicker turnaround times and smarter lending decisions—unlocking capital for more businesses, more quickly. In an environment where delays in funding can mean the difference between scaling up and shutting down, this speed and precision is revolutionary.
Efficiency Through Innovation
AI doesn’t stop at funding decisions. It can also optimise how SMEs operate day-to-day. Take AI-powered chatbots, for instance: they enable seamless customer communication through platforms like WhatsApp, offering round-the-clock service without draining internal resources. Rather than replacing employees, this kind of automation allows teams to shift focus to strategic areas like customer experience and long-term planning. Still, myths around AI persist—particularly in markets like South Africa, where digital transformation is uneven. Many SME owners assume that AI is too expensive, too complicated, or requires advanced tech skills. This hesitation is reflected in adoption statistics: fewer than 30% of South African SMEs have implemented digital operational tools. But the truth is, AI is more accessible than ever. Cloud-based solutions designed specifically for small businesses are not only affordable—they’re easy to scale and integrate.
Laying the Right Digital Foundations
Getting started with AI doesn’t require a full systems overhaul. A good first step? Implement a cloud-based enterprise resource planning (ERP) system. It consolidates real-time data from key business functions—sales, finance, inventory, HR—and creates a digital backbone. From there, plugging in AI tools becomes simpler and more impactful, whether it’s for cash flow forecasting or managing supplier relationships.
AI Isn’t Magic. It’s a Mindset
The SMEs that get the most from AI are those that embrace change proactively. They don’t wait for the stars to align. They start with what they have, adopt manageable tools, and build digital muscle over time. These businesses understand that AI isn’t a quick fix—it’s a long-term strategic enabler. As South Africa continues to navigate economic recovery, the need to digitally empower its SME sector has never been more urgent. AI offers a powerful solution—not only to unlock funding but to close the inclusion gap, bring informal businesses into the mainstream economy, and unleash the full potential of entrepreneurship across the country.
