Providing vital support to London start-ups during a challenging economic period, the British Business Bank’s Start Up Loans programme has been expanded.
It now includes start-ups that have been trading for up to three years and second Start Up Loans are now available to eligible businesses that have been trading for up to five years. The programme previously provided finance to start-ups which had been trading for up to two years.
Start Up Loans’ expansion 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 scheme has already delivered more than 20,400 loans worth more than £187m to new business owners in London since 2012.
Start Up Loans provides funding at a fixed interest rate of 6%, as well 12 months’ mentoring to its recipients, further supporting aspiring business owners in every corner of the United Kingdom. Start Up Loans’ impact has been particularly noticeable among individuals who might find it difficult to secure loans from traditional lenders.
Case study: Cherisse Brown, founder of Urbee, in South East London
Cherisse Brown took out a £10,000 loan in two parts to launch Urbee, an e-shop aiming to raise awareness about the importance of conserving bees and other pollinating insects.
The shop sells a range of Kent honey and seeds, as well as Staffordshire fine bone China mugs, coasters and scented candles. All packaging is plastic- free and sourced from sustainable materials. As such, Urbee’s gift bags are handmade in Jute hessian with hemp cord, two of the most environmentally friendly fabrics on the planet.
Cherisse Brown said, “Supporting the economy is really important and I am always striving to find ways to be more environmentally friendly. In the future, is hope to expand the line of products on offer and help children learn about pollinators.
“As a small business aiming to scale up, it’s incredibly reassuring to have the support of Start Up Loans and it was brilliant to have the opportunity to take out two loans through the scheme, allowing me to stagger my repayments.”
Richard Bearman, Managing Director of Start Up Loans, said, “We are delighted to be able to extend the reach of the Start Up Loans programme to help support businesses, including those who need extra support during a challenging economic environment. 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 consolidate and grow their businesses now that they are back on their feet. We want to ensure that these businesses do not get left behind.
“We have always been committed to providing support and funding to smaller businesses that across Scotland, with entrepreneurial ambitions across all industry sectors. Having delivered more than £187m in loans to London alone highlights our continued efforts to help people from diverse backgrounds achieve their business goals.”
Business Secretary Jacob Rees-Mogg said, “As one of the world’s foremost cities for business, London is home to one million small businesses whose tireless contributions continue to make our capital one of the best places in the world to live, work, and study.
“More than 20,000 of these SMEs have received Start Up Loans, totalling over £187m in support, and this expansion will go a long way towards helping them complete their recovery and scale up to meet the challenges and opportunities ahead.”
Martin McTague, Federation of Small Businesses National Chair, said, “The small business community shrank by 400,000 in the first year of the pandemic. As the new Government focuses heavily on economic growth and supporting enterprise, a major element of that will be encouraging a new wave of start-ups – the next generation of entrepreneurs from every diverse background, in all our local communities. So we welcome today’s announcement as it will help more people to start-up, and scale-up.”