The United Kingdom is emerging as one of the world’s most attractive destinations for technology businesses, surpassing rivals in the United States, Europe and Asia-Pacific, according to new findings from Barclays.
The bank’s latest Business Prosperity Index highlights growing confidence among UK technology leaders, with 62% of executives saying Britain offers a better environment to grow and scale than mainland Europe. A further 61% prefer the UK over Asia-Pacific, while 60% consider it more favourable than the US.
Industry leaders pointed to the country’s strong domestic market, access to a skilled and diverse workforce, and rapid consumer adoption of new technologies as major advantages compared with other global tech hubs.
The report comes amid rising demand for artificial intelligence, with 95% of surveyed firms reporting increased client appetite for AI-powered products and services. Half of those businesses expect to increase AI investment by at least 20% over the next year, underscoring its central role in future growth.
Confidence in the broader economic climate is also buoying the sector. More than three-quarters of firms (76%) said the UK’s macroeconomic conditions are supporting expansion, while 75% expressed optimism that the political environment would foster growth over the next three years.
Barclays’ client data indicates that many companies are on firmer financial footing than in recent years. Cash inflows rose by 1.7% in the first quarter of 2025 compared with the same period last year, while savings account balances jumped 21.5% as firms built reserves. Meanwhile, overdraft use declined by over a quarter, suggesting companies are moving away from short-term borrowing in favour of longer-term planning.
Despite the upbeat outlook, challenges remain. High fundraising costs were cited by 40% of firms as the biggest barrier to growth, followed by regulatory burdens (36%) and limited access to government funding and grants (33%). A large majority — 72% — stressed that stronger government support would be vital to sustain momentum.
Tech executives called for targeted initiatives such as specialist funding programmes (44%), incentives to attract overseas investors (37%), enhanced tax relief for equity investment (36%) and more grants for start-ups and smaller firms (36%).
Helena Sans, Head of Technology, Media & Telecoms & Innovation Banking at Barclays UK Corporate Bank, said the research underlined Britain’s global standing in the technology sector.
“Britain is holding its own on the global tech stage,” she said. “But 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.”
To support the sector, Barclays recently launched a bespoke £250 million Growth Lending Fund alongside its Innovation Banking team, aimed at providing capital to fast-growing firms. The bank has also pledged £22 billion through its Business Prosperity Fund to deliver financing, refinancing and tailored support for innovative companies at all growth stages.
With AI adoption accelerating and investor confidence rising, the findings suggest the UK’s technology sector is entering a decisive phase of expansion — provided funding and regulatory hurdles can be overcome.
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