Grants From The Government To Start A Business

Grants are spread across various sectors such as manufacturing, technology, transport, energy, ICT, security, climate, aerospace, food, health, environment, etc. It is important to find a grant that suits your business needs. This article talks about the top available grants categorised by industry.

Introduction to Business grants

Business grants provide funding without the need for repayment. These grants are available for various business sectors and stages of growth in the UK. Both government and private entities provide business grants to boost British businesses.

UK business grants often target specific areas, such as green initiatives, creative enterprises or support for underrepresented groups, such as black female entrepreneurs.

The Difference between a Grant and a Loan

Grants differ from loans because they provide funds that do not need to be repaid, reducing the pressure of accruing debt or interest.

These funds are usually awarded based on criteria such as business sector, location, innovation, or social contribution, with the aim of helping businesses achieve their objectives.

Types of grants are available for small businesses in the UK

There are a number of small business grants available for startups, entrepreneurs, and small businesses in the U.K. Each grant is tailored for specific business types, locations, demographics, or objectives, such as overseas exports.

These grants, whether from the government or private organisations, can range from low-cost and free equipment to cash awards to help business growth.

• Direct Grant

Government grants are typically provided as direct grants, where funds are allocated for startup essential tasks such as training, equipment investment, overseas exports or expansion into new markets.

While some grants may require businesses to match a portion of the grant value, amounts of up to £500,000 are available, depending on the business sector.

• Innovation grants

Innovation grants are prevalent in the U.K. for startups and established companies involved in research and development, often categorised by industry.

Similarly, resource and training grants target specific groups or needs, such as startup grants for people over 30 or grants for veterans transitioning to civilian life.

• Tax relief

Government-administered tax relief schemes may also apply to certain businesses, particularly those engaged in research and development in science and technology.

Young entrepreneurs can access support and funding through organisations such as the Prince’s Trust, which focuses on training and development to facilitate entry into the business world.

• Regional grants

Regional grants, backed by a significant financial commitment from the government, aim to boost businesses in different UK regions.

These grants are location-based, with resources available through platforms such as the British Business Bank website or local growth hubs.

Alternatives to business grants in UK

Consider alternatives to business grants. While grants may not always be an option, there are other avenues available:

Equity finance: This involves selling a part of your business for financing. Schemes like the Seed Enterprise Investment Scheme offer tax incentives for investing in new businesses.

Loans: Loans are offered with lower interest rates and more favourable terms than other loan options. The government-backed Start Up Loan Scheme offers personal loans of up to £25,000 with a 6% interest rate.

Purchase order financing: This allows businesses to cover upfront supplier costs before receiving payment for an order and ensures a smooth transaction.

Trade credit: It provides short-term, interest-free lending of goods or equipment with agreed repayment terms from suppliers. 

Search for government grants available for new businesses in the UK

Government grants are accessible to businesses across the UK, including in Wales and Northern Ireland through their respective legislatures, and in Scotland through the Scottish Parliament. For UK business startups, a helpful starting point is the Business Finance Help Finder tool.

Similarly, the Welsh Government provides a list of grants on its business grants website. Enterprise Ireland offers funding opportunities for small to large businesses, and the Scottish Government's Funding Opportunities website provides access to over 600 grants and funding options.

Grants available in 2024  in UK

Some of the grants available for environmental and sustainability initiatives are:

• Trees, Woodlands, and Forestry: Woodland Creation Planning Grant: Provides funding of up to £30,000 to create a UKFS-compliant woodland creation design plan.

• Woodland Creation Planning Grant: Provides funding to landowners, managers, and public bodies (excluding Forestry England) to create a woodland creation plan in line with the UK Forestry Standard (UKFS).

• Fisheries and Seafood Scheme (FaSS): Provides investment to ensure the long-term sustainability and resilience of the seafood sector in England.

• Tree Health Pilot: A scheme testing different methods to slow the spread of pests and diseases affecting trees in England.

• Regional Capacity Building: Funding is available for local or regional projects that promote the understanding, management, and conservation of the historic environment.

There are also further grants available for environmental and sustainability initiatives.

Technology, AI, and digital grants

Here are some of the technology-related grants available:

• The Manchester Prize: It is a challenge award for AI for public good, offering £1 million per year for AI R&D.

• The Public Engagement Response Prize: It is a rapid response funding of up to £10,000 for projects that raise awareness of unexpected discoveries, impacts, or address changes to the national curriculum or government policy related to STFC science and technology.

• Archives Skills Scholarship: Grants of up to £1,000 per person to enable archivists and heritage professionals to access training and development opportunities.

• Digital Development Grant: It is a customised support for aspiring and existing tech entrepreneurs, focusing on startups and scale-ups in the tech sector.

There are more technology grants available.

New Business/Startup Grants

Here are some of the grants available:

The Prince’s Trust: provides grants to young entrepreneurs aged 18–30 to start their entrepreneurial journey.

The Digital Growth Grant: provides specialist support for aspiring and existing tech entrepreneurs, focusing on startups and scale-ups in the tech industry.

Innovate UK: supports innovative UK businesses in using new technologies, developing ideas, and achieving commercial success.

Business and Finance Grants

Here are some of the funding options available:

• Gigabit Broadband Voucher Scheme (GBVS) (UK): Provides grant contributions to help businesses upgrade from broadband to high-speed cable.

• Funding Circle, UK: Provides peer-to-peer lending for SMEs setting up in the UK.

Additional grants in the UK

In addition to the grants mentioned earlier, there are various resources for finding more funding opportunities for your small business.

In the U.K., reputable platforms like Grantfinder and Gov.uk compile comprehensive databases of grants and funding options across a variety of sectors, industries, and regions.

Additionally, local business support networks, chambers of commerce, and trade associations provide valuable guidance and information on region- or sector-specific grants.

The process for applying for a government business grant in UK

Each grant program is different, so make sure you meet the general terms and criteria before proceeding with the application. Grants are highly specific, they often target specific types of businesses or initiatives aimed at uplifting the community.

Consider these tips when applying for a new business grant:

• Consult the grant body to assess your chances of success.
• Familiarise yourself with the grant objectives and tailor your application accordingly.
• Submit a comprehensive business plan demonstrating your professionalism and business standing.
• Emphasise how the grant will be used to advance your business and benefit others.
• Make sure your financial contribution matches the grant amount sought.
• Apply early to maximise your chances, as early applicants often face less competition for available funding.

Conclusion

Apply for the small business grants available in the UK for 2024 and make sure they suit your business needs before applying. Understand the specific requirements and application process for each grant type.

Getting a grant is just the beginning of your journey, as most grants have varying application complexities. Start by assessing your current and future business goals and finances.

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