A rise in interest rates this year could send thousands of small businesses into bankruptcy, according to insolvency expert Begbies Traynor.

In its first quarter update Begbies reported that small firms in the UK had £55bn of liabilities on their books.

The debts - typically owed to suppliers and service providers - would become difficult to maintain if the Bank of England's rate rose by 1%.

"A rate rise may tip more struggling businesses over the edge, especially in the embattled but vital SME sector which cannot afford the protection of sophisticated interest rate hedging," said chief executive Ric Traynor.