Read end-to-end by a FundingAtlas editor against the official source.
Quick answer
A government-backed personal loan of £500–£25,000 (fixed 6% interest) for new UK businesses, with 12 months of free mentoring. UK government-backed personal loan for people starting or growing a new business (trading less than 36 months). Includes free mentoring. It is aimed at Founders of new UK businesses or businesses trading under 3 years who can pass a personal credit check. Eligibility typically requires UK resident aged 18+, starting a business or trading less than
Funding amount
£500–£25k
Region
United Kingdom
Stage
Startup
Provider
Start Up Loans
Advisor view
This is debt, not a grant — repayment terms matter as much as headline access. Build a realistic cash flow that survives a 12-month sales slip.
Frequently asked questions
- What is a Start Up Loan?
- A Start Up Loan is a government-backed personal loan to UK business founders — a fixed-term unsecured loan with a personal guarantee, plus 12 months of business mentor support.
- Who is eligible?
- Founders of new UK businesses or businesses trading under 36 months who can pass a personal credit check.
- Is it really a personal loan?
- Yes. The loan is taken in the founder's personal name, with a personal guarantee. The borrower remains personally accountable for repayment regardless of business outcome.
- How long does the decision take?
- Typically a few weeks once a complete business plan and cash-flow forecast are submitted.
- What evidence is required?
- Business plan, 24-month cash-flow forecast, proof of ID and address, personal credit history and a clear use-of-funds statement.
- What are the most common reasons applications fail?
- Weak cash-flow forecast, poor personal credit, business already trading more than 36 months, or a plan that lacks credibility.
- Does the mentor support actually help?
- Yes — successful founders treat the 12 months of mentor support as part of the value, not a checkbox. It is a genuine differentiator from commercial personal loans.
- What if my business already trades more than 36 months?
- Start Up Loans is outside scope. Look at the Growth Guarantee Scheme, regional growth-hub support or commercial debt facilities.
- What comes after Start Up Loans?
- Many founders move on to the Growth Guarantee Scheme for larger debt facilities, or open an SEIS angel round for equity, or apply for Innovate UK Smart Grants for R&D.
- Where can I find the official scheme?
- The official scheme is at startuploans.co.uk, operated by the British Business Bank.
Who it's for
Founders of new UK businesses or businesses trading under 3 years who can pass a personal credit check.
Usually too early when
Advisor signal
You have no trading history, no realistic cash flow forecast, no clear use of funds, or you would struggle to service the loan if revenue softened.
Eligibility
UK resident aged 18+, starting a business or trading less than 36 months. Loan is personal and subject to credit assessment.
Evidence you'll need
Business plan, cash-flow forecast, proof of ID and address, personal credit history.
Application timeline
Typical decision in a few weeks once a complete plan and forecast are submitted.
Common reasons applications fail
Weak cash-flow forecast, poor personal credit, business already trading more than 36 months.
What improves your odds
A defensible 24-month cash flow, clear use of funds, clean management accounts, and a credible answer to growth-slips scenarios.
Typical successful applicant
A UK SME with a clear growth plan, demonstrable repayment capacity, and a finance function able to present management accounts on demand.
Common misconceptions
Government-backed lending is still lending. The guarantee protects the lender, not the borrower; you are personally accountable for repayment.
What happens next
If approved, sign a personal loan agreement and are matched with a business mentor for 12 months.
What comes next
Set up disciplined monthly management accounts, hold a cash buffer, and review the facility annually against original use-of-funds.
Funding context
Often used alongside equity, grants and supplier credit. The right blend depends on dilution tolerance and growth horizon.
Related routes
- Growth Guarantee Scheme vs Start Up Loans
- Start Up Loan vs SEIS-Backed Angel Investment
- Start Up Loans vs Angel Investment
- What comes after Start Up Loans?
- What comes after a Start Up Loan?
- What should UK startups apply for first?
- Grant, loan or investment?
- Which funding pathway should I follow?
- Startup Funding Pathway
- Growth Capital & Equity Ladder
- Growth Guarantee Scheme
- Seed Enterprise Investment Scheme (SEIS)
Industries
Objectives
Regions