The news comes during the worst week ever for computer virus attacks. Four different types of computer virus are currently circulating, presenting corporate and home users with major problems if they have not taken suitable precautions.
Neville Manuel, Vice President of value-added services at BT Openworld, said:
"It's frightening that small companies are ignoring the risks of IT security threats. No matter what size business you are, a major security problem could bring all your systems to a halt.
"This can have a serious impact on a business, in terms of lost sales, reduced productivity and damaged reputation. These are all dangers no company can afford to ignore".
The ISP surveyed 300 SMEs and found that businesses with less than five employees were most likely to have not taken precautions.
But the company took an optimistic outlook, claiming that the recent cyber attacks had led to a 500% increase in the number of hits on its web site, and that sales of its Internet Security pack, designed for the smaller business and less than £5 per month, had gone up by 100%.