The £884 million loan scheme for new businesses is to be greatly expanded, delivering much-needed finance to the UK’s array of innovative start-ups.
The Start Up Loans programme has already provided more than 95,000 loans to start-ups across the UK since its inception in June 2012, offering an average of just over £9,000 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 per cent, 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 three and five years old a much-needed government-backed finance to support their expansion at a crucial juncture.
The scheme has backed businesses across the UK, with more than £54 million provided to businesses in Scotland, £42 million in Wales and over £12 million 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.
