Start-Up Loans are government-backed loans available to new businesses in the UK, providing access to affordable finance, mentoring, and support.
Who is eligible for Start-Up Loans?
UK residents over 18 with a viable business idea can apply for Start-Up Loans. Sole traders and limited companies that have been trading for less than two years and have a business plan demonstrating their ability to repay the loan are eligible.
How much can you borrow?
Start-Up Loans offer up to £25,000 per business funding, repayable over one to five years with interest rates fixed at 6% per annum.
What can you use the loan for?
Start-Up Loans can be used to purchase equipment or stock, pay for marketing and advertising, rent premises or office space, hire staff, and cover other business costs.
How to apply for Start-Up Loans?
Businesses must submit a business plan, which is assessed and approved. The application process involves providing detailed financial information and a personal credit check.
What are the benefits of Start-Up Loans?
Access to affordable finance, support and guidance, and improved credit rating are some benefits of Start-Up Loans.
What are the risks of Start-Up Loans?
The most significant risk is that businesses may struggle to repay the loan, leading to financial difficulties and even bankruptcy.
How can you increase their chances of obtaining a Start-Up Loan?
Developing a solid business plan, seeking advice, building a strong credit rating, and demonstrating a commitment to the business can increase the chances of approval.
Our advice
Start-Up Loans provide valuable financing for new businesses in the UK, helping to reduce financial barriers to starting a business. However, businesses should carefully assess the risks and ensure a solid plan for repaying the loan. Our specialist accountants can provide comprehensive guidance and will help at every step to ensure your application is successful and you obtain the vital funding for your business.