Reported on Wed, 19 Jul 2006

The number of new businesses opened in the UK has risen over the past year and a business loan could help budding entrepreneurs to set up their own firm.

Over 100,000 new firms opened up in the first quarter of 2006, almost 35 per cent more than last year.

John Davis, marketing director for local business at Barclays, said: "A strong cyclical rebound in people starting a business has occurred in the first quarter but despite the high levels, the trading conditions for small business are still quite tough.

"We expect a more widespread improvement in small business trading conditions to occur later in 2006 and into 2007 as the current economic conditions pick up, providing improving opportunities for more individuals to set up and grow their business."

There has also been an increase in the number of businesses facing closure, with 111, 200 companies shutting down in the first quarter of the year.

Barclays advises that the increased closure rate does not reflect badly on the economy, as the closure rate reflects the surge in new businesses starting up over the past few years.

Taking out a business loan could help to fund business developments that could prove to be lucrative in the current economic climate.

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