Innovation loans: manufacturing and materials readiness

Key Features

Loans to enable the increase in manufacturing readiness of innovations in manufacturing systems or processes and/or materials development, integration or reuse.

Programme:     Innovate UK

Award:     Up to £1m

Opens: 26th Feb 2018

Closes: 2nd May 2018

! This scheme is now closed

Innovate UK is to offer up to £10m in loans to micro and SMEs for innovative manufacturing or materials projects.

The aim of this competition is to provide a loan which will help SMEs increase manufacturing readiness. This applies to innovations in manufacturing systems, technologies or processes, and/or materials development, properties, integration or reuse.

Proposals should focus on the scale-up of recent or ongoing manufacturing process innovation and/or materials development activities. The project’s aim should be to enable UK based companies to progress innovative manufacturing or materials developments to commercial readiness.

Projects should last up to 5 years, of which up to 3 years can focus on research and development (R&D), and up to 2 more years to establish a clear route to commercial success. Loan repayments will be required over a further period of up to 5 years.

Businesses must be able to show that they:

  • can cover interest payments
  • will be able to repay the loan on time
  • need public funding

Projects should focus on a manufacturing or materials innovation rather than a product innovation. Your project must show significant late stage innovation (in other words, be at an experimental development stage). It must also clearly show how you are working with end users, problem owners or those who will ultimately buy the results of your innovation in one of our priority areas:

  • innovation in a manufacturing system, technology, process or business model
  • innovation in materials development, properties, integration or reuse

Projects should focus on the scale-up of recent or ongoing manufacturing process and/or materials development activities. Those activities should have already overcome the main technical risks and be at a maturity of Technology Readiness Level (TRL) 5 or higher, and/or at a Manufacturing Readiness Level (MRL) of 4 or higher, when the loan period commences.

Specific themes

This competition is open for manufacturing process and materials development innovation from all manufacturing sectors. Loans will be available to fund all or part of the eligible project costs to develop manufacturing readiness in these innovative processes. The list below is not exhaustive:

1. Creation of new or improved manufacturing facilities

2. Development of software

3. Development of new business models

4. Materials testing

Project types

Your project should focus on later stage research and development (R&D) activities classified as experimental development. You are expected to be able to show a clear route to commercial success for your project.

You could 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 and will be a form of State Aid. For experimental development projects this grant equivalent, as a proportion of the eligible project costs, can be:

  • up to 45% if you are a micro or SME
  • up to 35% if you are a medium-sized business


To take on an innovation loan for a project you must:

  • be a UK based SME
  • carry out your project in the UK

Individuals, research organisations and large companies are not eligible for innovation loans. Only single businesses can receive loans, so collaboration with other organisations cannot be funded in this competition.