A growing divide in artificial intelligence adoption could leave smaller Welsh businesses struggling to compete, despite new research showing significant productivity and growth benefits for companies already using the technology.
A new AI Adoption Report from NatWest Cymru reveals that 80% of Welsh businesses using AI have experienced improvements in efficiency, while 73% report increased innovation and 59% say the technology has contributed to revenue growth.
However, the findings also highlight the challenge of ensuring businesses of all sizes can benefit from AI, with larger organisations significantly more likely to have adopted the technology than their smaller counterparts.
Across the UK, 44% of businesses are already using AI, with a further 41% expecting to introduce it within the next five years. Yet just 6% of current users have reached the most advanced stage of adoption, where AI is fundamentally changing how their organisations operate.
Businesses employing more than 100 people are almost twice as likely to be using AI as smaller firms, raising questions about whether differences in access to investment, specialist skills and technical expertise could widen existing productivity gaps.
For Wales, where smaller businesses play a significant role in the economy, the findings underline the importance of making AI adoption accessible beyond larger organisations and technology-focused companies.
Robert Begbie, CEO, Commercial & Institutional Banking at NatWest, said:
“AI has the potential to be a powerful driver of growth, but the businesses that succeed will be those that use it to deliver better customer outcomes while building trust through transparency and human accountability.
“There is a real risk of an AI adoption divide emerging, particularly for smaller businesses with less access to skills, investment and specialist expertise. As both a major adopter of AI and the UK’s leading business bank, NatWest has a role to play in helping more businesses turn AI’s potential into growth.”
The research suggests that the challenge is not simply encouraging businesses to experiment with AI, but helping them embed the technology into everyday operations in ways that deliver measurable improvements.
It also identifies customer trust as a potential barrier to wider adoption. Across the UK, 79% of customers say access to a real person remains important, while 76% want businesses to be transparent about when AI is being used and 75% want greater clarity about how their personal data is handled.
These findings suggest businesses will need to balance automation and efficiency with transparency and human accountability as AI becomes more widely integrated into customer services and business processes.
Siwan Rees, Manager for NatWest Cymru Accelerator, said:
“The research shows businesses across Wales are already seeing real benefits from AI in improving efficiency, driving innovation and supporting growth.
“The opportunity now is to help more businesses move from experimentation to implementation. By building skills, confidence and access to support, we can help ensure businesses across Wales are well placed to benefit from the opportunities AI presents.”
NatWest is expanding its support for businesses looking to develop their AI capabilities, including enhanced training for relationship managers and plans to deliver 5,000 AI learning and adoption engagements through the NatWest Accelerator over the next 12 months.
The bank is also introducing specialist support in collaboration with Google Cloud and a new AI Adoption Programme developed in partnership with Lancaster University.
The importance of translating emerging technologies into practical business improvements was also explored at a recent NatWest Cymru roundtable held at its Cardiff Accelerator Hub.
Chaired by Jacqui Murray, Director of the High Value Manufacturing Catapult in South Wales, the discussion brought together representatives from business, academia and industry to consider how AI, robotics and automation could strengthen productivity and economic growth across Wales.
Participants examined the importance of innovation, workforce skills and practical support in helping businesses adopt new technologies.
One example of AI being used commercially is Welsh technology company Academii, which is developing artificial intelligence and virtual reality solutions to transform workforce training.
Supported by the NatWest Accelerator, the business has accessed coaching, specialist expertise and networks to support its growth.
Its technology enables organisations to create immersive, personalised training experiences for frontline employees, adapting learning in real time to improve engagement and skills development.
The platform is being used by Scottish and Southern Electricity Networks (SSEN), enabling employees to practise complex operational scenarios in virtual environments before working on live infrastructure.
The approach demonstrates how emerging technologies can support workforce development and safer working practices alongside productivity improvements.
While NatWest’s findings point to considerable opportunities for Welsh businesses, they also suggest that access to skills, investment and practical implementation support will be central to determining how widely those benefits are shared.
With the majority of Welsh businesses already using AI reporting efficiency gains, the next challenge will be ensuring that smaller companies have the confidence and capability to turn experimentation into sustained improvements in business performance.
