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What UK Government Grants are Available to New Businesses?


Government Start Up Grants

Government-funded start up grants are available to prospective business owners who are ordinarily resident in the UK. The levels of funding available vary, but often start at £4,000. Below is an overview of the main grant schemes available.

The Start Up Loans scheme

The Start Up Loans scheme is available to all UK residents aged 18 and above who require funding to set up a business. This is one of the most popular grant schemes available to UK-based entrepreneurs, and in 2015 alone it helped fund more than 13,000 companies. The scheme is administered by the Start Up Loans Company, although this is a government-backed programme that also receives support from The Business Bank. Funds are provided through unsecured loans, which have a maximum repayment term of 5 years. Loans cannot exceed £25,000 and interest rates are fixed at 6 per cent.

In addition to funding, the Start Up Loans scheme offers a support package that includes mentoring and a range of discounted business products, such as reduced PayPal rates, free website hosting, free business banking, free access to accounting software, and more. You can learn more about all the benefits available here.

Once the application is sent, prospective business owners will be matched to a delivery partner / business advisor, whose role is to offer support and advice when creating a business plan. This document will then be used by the Start Up Loans Company to evaluate whether funding will be granted or not. For detailed information, please visit the Start Up Loans scheme (www.startuploans.co.uk)

The Prince’s Trust Enterprise Programme

This funding scheme is available to entrepreneurs aged between 18 and 30 years old who have a business idea but are currently unemployed or working part-time. Loans range between £4,000 for sole trader companies and £5,000 for limited partnerships. Training, mentoring, and one-on-one support are also part of the programme. This scheme has been in place since 1983, and more than 80,000 entrepreneurs have already benefited from it. For more details on the eligibility criteria and on how to apply, visit www.princes-trust.org.uk/help-for-young-people/support-starting-business

Innovate UK

This grant scheme is available to UK startups that are significantly involved in the intellectual property, health and life sciences, manufacturing and emerging and enabling technology sectors. Under this scheme, successful applicants can receive funding that covers 100 per cent of their fundamental research costs, 75 per cent of the cost of feasibility studies and industrial research, and 45 per cent of experimental development projects (these figures apply to small businesses and micro enterprises).

Horizon 2020

Horizon 2020 is a funding scheme backed by EU governments. UK entrepreneurs can access funding as long as their business plan has a strong component of research and development. Approximately €3 billion have been allocated as funding for innovative SMEs, and a further €900 million are earmarked for the Access to Risk Finance programme. Applications consist of a 4-stage process, which is explained in detail in the Horizon 2020 (https://ec.europa.eu/programmes/horizon2020/en/how-get-funding).

In addition to the grant schemes mentioned above (which are available to UK entrepreneurs nationwide and irrespective of their location), there are a series of regional grants available. These are often administered by regional development agencies or local councils, and are generally approved faster than national grants (taking 6 to 8 weeks on average).

Among the most popular RDA-funded grants we can highlight the Grant for Business Investment scheme, which is available to UK businesses in various stages of development, including the start-up stage. This scheme specifically caters to high-budget business projects and the level of funding starts at £10,000.Funding can cover up to 35 per cent of the costs involved in setting up an SME. Certain industry sectors are excluded from this scheme.
You can find a comprehensive list of all regional small business grants at the Entrepreneur Handbook (entrepreneurhandbook.co.uk/grants-loans) and at the Gov.uk site.

 



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