UK Innovative business funds: COVID-19
To help the businesses engaged in innovation and technological development the government has announced a £1.25 billion package which is divided into two funds:
- Future Fund: This package aims to aid the high-growth firms. An amount of £500 million has been allocated to this scheme.
- Innovative UK Fund: This package aims to support the small and medium-sized businesses focusing on research and development The Amount of £750 million has been allocated to this scheme.
The funds under this scheme will be delivered in partnership with the British Business Bank. It is set to be launched in May 2020.
Features of Future Funds
- The number of funds that can be raised by UK businesses under this scheme is between £125,000 and £5 million.
- Upon the company’s next qualifying funding round, or at the end of the loan period if the funds are not repaid, then the loan shall automatically convert into equity.
- The eligibility criteria for applying under this scheme is that the business should be an unlisted UK registered company that has previously raised at least £250,000 in equity investment from third-party investors in the last five years.
- Click here to check the headline terms setting out the main features expected to apply to the loans.
Innovative UK Fund
The funds under this scheme will be made available through Innovate UK’s grants and loan schemes. Innovate UK is the national innovation agency (ANI) that operates independently of the Government to invest in firms driving science and technology innovations likely to boost the U.K. economy. Under this funding scheme the disbursement has been done as follows:
- An amount of up to £200 million will be made available to accelerate grant and loan payments to Innovate UK’s 2,500 existing customers, on an opt-in basis.
- Another amount of £550 million will be made available for existing customers by way of additional support.
- £175,000 of financial support will be offered to 1,200 firms who do not currently receive Innovate UK funding.
How to apply for innovative UK Funds?
The facility to apply for the loan is not available yet. It will be launched in May and some payments can be expected to be made by mid-May.