Even if SMEs are aware of the benefits of ICT, they will only adopt ICT if they can overcome the barriers to its adoption. The lack of affordable and accessible ICT infrastructure is the first obstacle that SMEs need to overcome, whether they are adopting basic ICT such as phones or more advanced ICT such as e-commerce. The next obstacle is human capacity. Users must understand how to use ICT and how it will change the way they do business. This obstacle is more prominent for advanced ICT such as e-commerce and ERP software than for basic ICT such as phone lines and fax. The third obstacle to overcome is financing. This is problem for both basic and advanced ICT. Having the appropriate legal framework is the last obstacle to overcome because it mainly applies to online transactions. SMEs can still adopt phone lines, email, and many e-applications without a well-defined legal structure.

Governments can and have addressed these barriers to adoption in several ways.
Infrastructure

Governments can help SMEs reduce ICT connection costs and increase coverage by further expanding its infrastructure, offering subsidies, encouraging ICT providers to have special discounts for SMEs, equipping incubators with ICT at a reduced cost, or allowing alternative methods of communication such as VoIP.

Human capacity

Ways that governments can help increase ICT adoption among SMEs include hosting training workshops that are flexible and tailored to specific industries, employees’ position and role, or software/hardware applications; providing subsidies for ICT training; and creating opportunities for firms to try the technologies hands on.

Financing options

Governments can increase the affordability of ICT through grants, credits, leasing options, and tax incentives. To encourage SMEs to use ICT equipment to increase productivity, the Japanese government allows corporations to deduct up to 6 percent of total lease payment on brand-new machines from annual income tax payments. The government also subsidizes up to 25 percent (with a cap at JPY 2.5 million) lease payments for corporations in agribusiness management, lumber supply, and aquaculture1.