An £884m loan scheme for new businesses is to be greatly
expanded, delivering much-needed finance to the UK’s array of
innovative start-ups, the Business Secretary has announced today (Sunday
25 September).
The Start-Up Loans programme has provided more than 95,000 loans
to start-ups across the UK since its inception in June 2012,
offering an average of just over £9000 in support.
With 33,000 new loans available, the programme’s eligibility will
be expanded to support businesses trading for up to three years,
up from two years. Businesses can apply immediately under the new
criteria.
Start-Up Loans provide a fixed interest rate of 6%, as well as
mentoring, support and funding to aspiring business owners across
the UK, providing support to those who might find it difficult to
secure loans from traditional lenders.
Alongside this, a new second loan will be available to businesses
operating for up to five years, providing eligible businesses
between 3 and 5 years old a much-needed Government-backed finance
to support their expansion at a crucial juncture.
Business Secretary said:
“This government is relentlessly focused on driving growth to
create better jobs, boost wages and fund our vital public
services like the NHS.
“Encouraging entrepreneurship and new businesses to thrive is
critical to growing the economy and raising living standards.
“From a hair salon in Wales, to a furniture business in Northern
Ireland and a cake seller in the Lake District, expanding the
Start Up Loans Scheme will support these small businesses through
this challenging period and position them to grow - creating jobs
and opportunities across the UK.”
The scheme has backed businesses across the United Kingdom, with
more than £54m provided to businesses in Scotland, £42m in Wales
and over £12m in Northern Ireland.
Expansion of the Start Up Loans scheme follows the 2021/22
Spending Review, at which the government made the commitment to
provide 33,000 loans to the programme over the next three years.
The extension provides further government support for businesses
grappling with cost pressures and adds to measures announced by
the Chancellor earlier this week, including the introduction of
the Energy Bills Relief Scheme to help support them with the
costs of energy, reforming off payroll working rules and
simplification of the alcohol duty system.
It also builds on key measures the Government has announced for
small businesses in particular, including extending the £4.5
billion Recovery Loan Scheme and delivering the Help to Grow
schemes, which provide mentoring and free software to thousands
of businesses across the UK.
Michelle Ovens CBE, founder of Small Business Britain
said:
“The expansion of funding opportunities for start-ups and growing
businesses will certainly be welcomed by small firms as a
positive move to unleash their potential. Access to finance is
vital for entrepreneurs to grow, and with rising costs and
challenges across the board they need all the help they can
get right now to realise their ambitions.”
British Business Bank, Managing Director of Start-Up
Loans, Richard Bearman, said:
“We are delighted to be able to extend the reach of the Start-Up
Loans programme to help support businesses who need extra support
during a time of continued economic unrest.
“This extension of the programme will enable us to work with
those businesses that had perhaps just got going when the
pandemic hit, or are ready to scale up now that they are back on
their feet. We want to ensure that these businesses do not get
left behind.”
