The Federation of Small Businesses (FSB), using figures from the House of Lords Science & Technology Committee, said just 18% of smaller businesses are selling online and fewer than 1% made all of their sales through the Internet.

The risk of online fraud is thought to be behind their reluctance to engage in e-commerce but just 6% of businesses have suffered from Internet credit card fraud.

The FSB said it supported moves to tackle online crime.

A spokesman said:

"E-crime needs to be given the same status as crime that is committed against a bricks and mortar business.

"Only when this is accomplished, by implementing the Lords recommendations, can more small businesses benefit from having a stronger online presence. Customers will also benefit from the increased choice and convenience that online security can bring."