Best Small Business Grants and Schemes for UK Start-ups

Starting a business is an exciting idea. But funding for any new business is no doubt a challenging job. Several grants exist in the UK to help entrepreneurs bring their ideas to life. Entrepreneurs prefer grants instead of business loans as grants need not be repaid. Explore a few of the best grants and schemes available for UK start-ups.

The Start-Up Loans Scheme

It is a government backed start-up loans. This scheme is designed to help aspiring entrepreneurs who want to start either a new business or grow their existing business. It offers personal loans for business purposes. It’s an effort taken by the UK Government to support entrepreneurship and economic growth, particularly for people who may struggle to secure traditional business financing.

Innovate UK Smart Grants

The main objective of this grant is to foster innovations that address important challenges, open new markets, or create significant business opportunities. This is a part of the UK’s funding initiatives to support businesses and organizations involved in research and innovation. Any business entity whether it’s small, medium or big can apply for this grant. Innovate UK typically funds a portion of the project costs. The level of funding varies depending on the type of organization involved (small businesses often receive a higher percentage of the total project costs than larger enterprises).

Local Enterprise Partnership (LEP) Grants

Business enterprises can avail of this grant if they need capital investment, such as new equipment, expansion of facilities, or other tangible assets to help the business grow. For new businesses, LEPs often provide financial support to help them get established, particularly in industries or sectors that align with regional economic priorities.

Many LEP grants require match funding, meaning that the business must provide a certain amount of investment (often 50%) to access the grant. This ensures the business is equally invested in the project’s success.

From 1 April 2024, government decided to withdraw central government support (core funding) for Local Enterprise Partnerships and transfer their functions to local and combined authorities.

Seed Enterprise Investment Scheme (SEIS)

This is one of the most well-known schemes designed to help start-ups raise funds while they do trading. On the other hand, it encourages investors to get tax relief by investing money to purchase shares of the new company. Investors can claim 50% income tax relief on the cost of the investment.

Business Wales Start-Up Grant

This grant offers up to £2,000 for eligible individuals in Wales to support the growth of new businesses. Whether you need help with equipment, marketing, or other startup costs, this grant could be your boost! Individuals 18-30 or 25+ who are unemployed or economically inactive can apply for this grant. But before applying, you will have to register for their services. Once you register you can get access to a business adviser who can guide you through the process.

Small Business Research Initiative (SBRI)

It is renamed to Contracts for Innovation. And please note that this is not a grant. It is a contract. Transforming any innovative idea into real real-world solutions can be challenging without the right support. That’s where the Small Business Research Initiative (SBRI) comes in. SBRI operates on a contract basis. Under the SBRI’s contract-based structure, the business retains ownership of the intellectual property (IP) it creates. This is a significant benefit because it allows the company to commercialize the solution in other markets after the contract ends.

Conclusion

Whether you’re launching an innovative tech company or a small local business, finding the right grant can give you enormous financial support. Therefore explore all available options, understand the eligibility criteria and make sure to submit all necessary documents with a well-written application so that no problem will arise to get the grant sanctioned.