Innovation loans: September 2019 open competition

Key Features

Loans for game-changing innovations with strong commercial potential that will significantly improve the UK economy.

Programme:     Innovate UK

Award:     Share of up to £10 million

Opens: 23rd Sep 2019

Closes: 27th Nov 2019

! This scheme is now closed


Innovate UK is offering up to £10 million in loans to micro, small and medium-sized enterprises (SMEs). Loans are for highly innovative late stage projects with the best game changing and/or disruptive ideas or concepts. There should be a clear route to commercialisation and economic impact.


The purpose of this competition is to help businesses overcome barriers to their cutting-edge innovations becoming a successful, commercial reality. The aim is to make a considerable economic impact and/or result in significant, sustainable business growth.

Your idea must lead to innovative products, processes or services that are significantly ahead of others in the field. Your project can include prototyping, demonstrating, piloting, testing and validation in environments that represent real life operating conditions.

Your proposal must demonstrate:

  • a clear game-changing and/or disruptive innovative idea
  • a strong and deliverable business plan that addresses (and documents) market potential and needs
  • a team, business arrangement or working structure with the necessary skills and experience to run and complete the project successfully and on time
  • awareness of all the main risks the project will face, with realistic management, mitigation and impact minimisation plans for each
  • sound, practical financial plans and timelines that represent good value for money
  • a clear, evidence based plan to deliver significant economic impact, return on investment (ROI) and growth through commercialisation, as soon as possible after project completion.

Your proposal must demonstrate:

  • a clear, considerable potential to make a significant and positive impact on the UK economy and/or productivity
  • realistic, significant potential for global markets

Projects should last up to 5 years, of which up to 3 years can focus on late stage research and development (R&D), and up to 2 more years on establishing a clear route to commercial success. Innovate UK will require loan repayments over a further period of up to 5 years.


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

  • be a UK registered SME
  • carry out your project in the UK
  • intend to exploit the results from or in the UK
  • give evidence that your business is suitable to take on a loan

Individuals, academic institutions, 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.

Any UK business claiming funding must be eligible to receive state aid at the time that Innovate UK confirm you will be awarded funding.

Funding Costs

Innovate UK have allocated up to £10 million in this competition to fund innovation projects through innovation loans to suitable SMEs.

They will offer loans of between £100,000 and £1 million. This is based on your project proposal and their judgement of the suitability and affordability of a loan for your business.

Projects must last up to 5 years and are expected to start by May 2020.

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 small business
  • up to 35% if you are a medium-sized business


In this competition Innovate UK are not providing grant funding.

Innovate UK will not provide funds to match the grant funding of any other projects.

Loans will be declined for businesses which:

  • are considered unable to afford the interest and repayments on the loan
  • have not demonstrated that they are unable to obtain finance from other sources on suitable terms