As small and medium-sized enterprises in China increasingly turn to digital trade to reach global markets, their expanded online presence will also expose them to a surge of cyberattacks, according to a senior Mastercard executive.

"A small business somewhere in China could reach a global audience via platforms like TikTok, Facebook or Instagram, or Chinese local platforms like Alibaba," said Mark Barnett, global head of SMEs at Mastercard.

"That's probably more true in China than anywhere else," Barnett told China Daily in a recent interview.

Data from the Ministry of Commerce show that in June, China was home to more than 120,000 cross-border e-commerce businesses, with their presence expanding from major metropolitan and provincial capitals to second- and third-tier cities.

However, Barnett cautioned that while creating a valuable gateway to global consumers, this digital presence also opens businesses up to potential cyberattacks.

"That's a double-edged sword," Barnett said. "We did global research recently, which showed that 46 percent of all small businesses had a cyberattack in the last twelve months."

The "really disturbing fact "was that nearly one in five small businesses that suffer a cyberattack close their doors within a year, Barnett added.

"SMEs are the heartbeat of every economy. They're 90 percent of all businesses, 70 percent of employment and 50 percent of GDP," Barnett said. "What's fundamentally important is that some of the small businesses will one day become big businesses anyway because they innovate."

According to a November report by the China Internet Network Information Center, China's SMEs numbered 63.49 million as of September. This robust sector is a cornerstone of the economy, contributing significantly to stable growth and broader social development.

Moreover, a survey by the China National Intellectual Property Administration showed that independently developed valid invention patents from SMEs accounted for 75.3 percent of the total in 2024.

To help enhance the "resilience" of small businesses in the face of cyber incidents, Mastercard has launched a vulnerability scanner service. SMEs can run a report enabling them to pinpoint, prioritize and act on cybersecurity threats to their websites or apps.

Meanwhile, Mastercard has been deploying generative AI that can scan data points and assess the likelihood of a transaction being fraudulent.

"We process around 150 billion transactions a year, and every one of those is scored for fraud. We can provide that score because we have models that teach themselves what transactions are most likely to be fraudulent," Barnett said.

"There are a lot of things about the Chinese market that are fairly unique, and some of which I'm sure will be able to be applied globally," he added.

Earlier this month, the Ministry of Industry and Information Technology and the National Financial Regulatory Administration rolled out a second round of cyber insurance pilots, promoting inclusive policies to help safeguard legions of SMEs against cyber threats.

The first round kicked off in 2024 and has since wrapped up with over 1,500 policies written to enterprises. The program generated more than 150 million yuan ($21.14 million) in premiums, providing coverage valued at close to 11.5 billion yuan.