UK registered businesses can apply for loans for innovative projects with strong commercial potential to significantly improve the UK economy.
Programme: Innovate UK
Award: Share of up to £2 million
Opens: 20th Sep 2022
Closes: 9th Nov 2022
Innovate UK is offering up to £25 million in loans to micro, small and medium sized enterprises (SMEs). Loans are for highly innovative late stage research and development (R&D) projects with the best potential for the future. There should be a clear route to commercialisation and economic impact.
Your project must lead to new products, processes or services that are significantly ahead of others currently available or propose an innovative use of existing products, processes or services. It can also involve a new or innovative business model.
Your project must focus on one or more of the future economy areas included in the Innovate UK plan for action.
This competition offers loans to help businesses overcome barriers to their innovations becoming a successful, commercial reality. The aim is to make a considerable economic impact which results in significant, sustainable business growth.
Innovate UK is looking for businesses who can demonstrate that their projects have the best potential for the future.
Your idea must lead to innovative products, processes or services that are significantly ahead of others currently available. It can also involve a new or innovative business model.
Your proposal must demonstrate:
Your project can include:
These can be in environments that represent real life operating conditions.
Your application will be evaluated on our:
Innovate UK will decline loans for businesses which:
Innovate UK are looking to fund a portfolio of projects and businesses, across a variety of technologies and markets, with a particular focus on future economy areas set out in the Innovate UK plan for action.
Your project must focus on one or more of the following themes or sub-themes:
Health and Wellbeing
Next generation digital technologies
Innovate UK are also particularly interested in receiving applications from diverse businesses; those involving communities that are typically under-represented, including from regions outside the ‘Golden Triangle’ (London, Oxford and Cambridge) or with for example, female, ethnic minority and diverse ability founders.
You can apply for a loan of between £100,000 and £2 million to fund your project’s eligible costs.
Projects can last up to 5 years, including both the R&D and commercialisation phases. Projects are expected to start by 31 May 2023.
To receive an innovation loan for a new project you must:
Innovate UK will evaluate whether your business is suitable to receive an offer of a loan for your project.
Individuals, large companies, not for profits, charities, academic institutions, and research organisations are not eligible for innovation loans.
Only single businesses can receive loans, so collaboration with other organisations cannot be funded in this competition.
Under current restrictions, this competition will not fund any procurement, commercial, business development or supply chain activity with any Russian or Belarusian entity as lead, partner or subcontractor. This includes any goods or services originating from a Russian or Belarusian source.
Subcontractors are allowed in this competition.
You can use a previously submitted application to apply for this competition.
In this competition we are not providing grant funding.
Innovate UKwill not provide funds to match the grant funding of any projects.
Innovate UK will not fund commercial activities such as marketing and sales.
Innovate UK cannot fund projects that are:
Innovate UK has allocated up to £25 million to fund innovation projects across the current rounds of this competition.
Innovate UK will offer loans of between £100,000 and £2 million, based on your project proposal and our judgement of the suitability and affordability of a loan for your business. The Innovate UK Loans Ltd credit committee will decide the final terms, amount and length of the loan offer.
Innovation loans will be:
You will not have to make repayments but you will pay interest on the amount you have borrowed at 3.7% per annum, with additional interest at 3.7% accrued and deferred until the repayment period.
These are the longest periods we will consider. The overall term of the loan must not exceed 7 years. Your application must propose how long your project (including the availability and extension periods) will last and how long the repayment period you are requesting, will be.
These periods should be based on the needs of your business. We will consider the suitability of your proposed timings in any loan offer that we make to you.
Innovate UK expect to take security in the form of a debenture. We will not require personal guarantees.
More details of our approach, including a summary ‘heads of terms’ document setting out the main terms and conditions of the loan, is in the terms and conditions for this competition.
You can get a loan of up to 100% of your eligible project costs. Since the loan will have favourable terms (particularly a below-market rate of interest) the value of this benefit over the life of the loan will be the equivalent of a grant.
The gross grant equivalent will be the present value, at the date of commitment of the loan, of the difference between the market cost of interest and fees of a similar loan (using reference rates for interest) and the cost of an innovation loan.
For experimental development projects this grant equivalent, as a proportion of the eligible project costs, can be:
Innovate UK expect that most innovation loans will meet this requirement.
Book an appointment to speak to one of our advisors to discuss your eligibility to apply for this Grant Funding opportunity.