The UK is emerging as a leading destination for technology sector growth, surpassing other major markets such as the United States, mainland Europe, and the Asia-Pacific region, according to new research from the Barclays Business Prosperity Index. The study surveyed 500 technology business leaders and found that 62% view the UK as a more attractive place to grow and scale their businesses compared to mainland Europe. Similar percentages favour the UK over Asia-Pacific (61%) and the US (60%). Respondents highlighted strong market opportunities, access to skilled talent, and rapid consumer adoption of technology products as key factors.
Interest in artificial intelligence continues to rise among UK tech firms. Half of those surveyed plan to increase AI investment by at least 20% in the next year, while 95% report growing client demand for AI products and services.
Barclays’ anonymised client data comparing Q1 2024 with Q1 2025 shows cash inflows into technology businesses rose by 1.7%. While overall current account balances declined by nearly 10%, savings account balances increased by over 21%, indicating that tech companies are holding onto cash for future investments. Overdraft usage fell by more than a quarter during this period.
Confidence in the economic environment remains high, with more than three-quarters of tech firms saying that both macroeconomic conditions (76%) and the political landscape (75%) are supporting their growth outlook for the next three years. Seventy percent expect to invest more capital this year compared to last year, with an average planned increase of nearly 9%.
Despite these positive indicators, challenges remain for tech businesses seeking funding. The most significant barriers cited include high fundraising costs (40%), extensive regulatory requirements (36%), and limited government funding or grants (33%). Most companies believe that government support is essential for maintaining the UK's position as a global leader in technology innovation. Specific requests include specialised funding programmes (44%), enhanced support for attracting international investors (37%), improved tax incentives for equity investments (36%), and more grants for start-ups and small businesses (36%).
Helena Sans, Head of Technology, Media & Telecoms & Innovation Banking at Barclays UK Corporate Bank, said: “There’s a clear sense that the UK is holding its own on the global tech stage, with founders and leaders increasingly seeing the UK as one of the best places in the world to grow and scale.
“To keep up this momentum, we’ve got to break down the remaining roadblocks – including access to funding, attracting global investors, and building a stronger appetite for risk.
“That’s why at Barclays we recently launched the Innovation Banking team along with a bespoke £250m Growth Lending Fund, designed to support fast-growing tech businesses with the capital they need to scale confidently.”
Sheetal Shinh, Head of Innovation Banking at Barclays Business Banking said: “Access to finance is a key issue for tech businesses looking to scale. At Barclays, we’re backing these ambitions through our £22bn Business Prosperity Fund and tailored support for early-stage innovators. Whether it’s helping founders navigate their first funding round or connecting them to specialist advice, our Innovation Banking teams are here to unlock growth at every stage of the journey.”
The Barclays Business Prosperity Fund offers lending and refinancing options across its business banking divisions throughout the UK. More information about this fund can be found at https://home.barclays/businessprosperity.
Tech companies interested in additional support can also register with Barclays’ Innovation Banking team via https://www.barclays.co.uk/business-banking/sectors/innovation/.
Barclays describes itself as a diversified bank aiming to be a leader in global finance from its UK base. Its five divisions cover consumer banking in both retail and corporate segments within Britain; wealth management; investment banking; and specialist US consumer operations.