Nearly half - 44 per cent - of Scottish small and medium sized enterprises lack basic digital skills, according to the latest Bank of Scotland Business and Charity Index.
Scottish SMEs are also failing to move protect their assets against cyber threats as two fifths (41%) did not have the appetite to develop their cyber security capability,
It is claimed that by better embracing digital skills UK businesses could generate an additional £85 billion in turnover.
Read more: Tech skills gap warning in global race for IT talent
Despite this, only 22% of Scottish businesses are gaining a transactional benefit from trading online domestically.
The figure falls further when it comes to targeting international markets, with 13% of Scottish businesses using online channels to trade overseas.
The report also found that only 8% of Scottish SMEs use digital channels to search and discover growth opportunities for their business.
It is claimed that SMEs and charities with advanced digital capabilities are able to save a day a week, showing that "the benefits of digital go beyond the bottom line".
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Philip Grant, chair of the Scottish Executive Committee at Lloyds Banking Group, said: “Scotland’s digital technology sector is forecast to grow twice as fast as the Scottish economy overall in the years to 2024.
"Our findings show that SMEs are capitalising on this momentum with over half (56%) with full basic digital skills, an increase of 21% compared to figures reported in 2015."
However, he added: "There is still more that can be done to further upskill and build confidence in using digital technologies that will create opportunities to drive productivity and boost revenue.
One business owner that has grown in digital confidence, capitalising on digital platforms to build revenue is the Scottish Fruit Company founder Danya Caceres.
She said the firm is now working towards an e-commerce, Shopify platform to extend sales online, which will mean the business will be able to extend its opening hours.
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