In the 2011 Budget 21 new Enterprise Zones were announced with superfast broadband, lower taxes and lower levels of regulation and planning controls. So far those in Leeds, Sheffield, Birmingham, Bristol, Liverpool, London, Manchester, Derby, Nottingham, the Black Country, the Tees Valley, the West of England, the North East, Cheshire, Essex, Cornwall, Gosport, Hereford and Humber Estuary have been announced.

Enterprise Zones will benefit from:

• A 100% business rate discount worth up to £275,000 over a five year period, for businesses that move into an Enterprise Zone during the course of this Parliament
• All business rates growth within the zone for a period of at least 25 years will be retained and shared by the local authorities in the LEP area to support their economic priorities
• Government and local authority help to develop radically simplified planning approaches in the zone
• Government support to ensure superfast broadband is rolled out in the zone. This will be achieved through guaranteeing the most supportive environment and, if necessary, public funding.

The support for businesses has been notoriously confusing, which is why Solutions for Business, a streamlined portfolio of business support, has been set up. The transition is still taking place with product availability varying in different parts of the England as products are tendered for when existing products expire.

Businesses can be eligible for support, including loans, grants and equity, in a wide range of areas from starting up and finance to accessing international opportunities. Solutions for Business is only available in England with different Government support for businesses on offer in Scotland, Wales and Northern Ireland.

The Solutions for Business portfolio of products includes those for Starting Up, Finance & Grants, Employing People, Grow Your Business, Exploit Your Ideas, IT & E-commerce and Environment & Efficiency.

Understanding Finance for Business provides free advice and support for entrepreneurs and businesses to ensure they understand their options for getting the money they need to start, sustain and grow.

Small Loans for Business provides loans of up to £50,000 to help start or grow a business when it’s difficult to secure finance from other sources. Loans can be used to secure services, purchase equipment or meet a funding shortfall. For more information or advice click here.

The Enterprise Finance Guarantee provides lenders with a government guarantee to loan money to businesses with strong business plans but which have been denied a standard loan because of a lack of collateral.

Finance for Business offers flexible finance solutions such as loans and equity finance for businesses with viable business plans that are unable to get support from commercial banks and investors.

Grant for Business Investment (GBI) offers capital to support investment or job creation and is for the acquisition of key assets such as buildings, machinery and equipment. Grants start from £10,000.

Below are details about the two principal UK-wide initiatives, the Enterprise Finance Guarantee (EFG) scheme and Enterprise Capital Funds (ECFs). There are additional programmes in England, Wales, Scotland and Northern Ireland.

This scheme aims to help 6,000 SMEs  every year with a turnover up to £25 million with loans ranging from £1,000 to £1 million with the government guaranteeing 75% of the loan and the lenders the other 25%.

The flexibility of this scheme means businesses can access new loans, refinance existing loans, convert overdrafts into loans, gain a new overdraft or extend a current one and cover cash flow shortages.

In November 2010 it was announced that the scheme would continue for a further four years.

Who can apply: Everyone except the coal industry, although there are partial restrictions in the agriculture, financial, education, forestry, insurance and transport sectors.

How to apply: Businesses seeking debt finance can approach one or more of the participating lenders

Further information: Department for Business Innovation & Skills 

 

In total nine of these funds have been launched since 2006 with the aim of investing in fast-growing SMEs. These funds address a market weakness in the provision of equity finance by using Government funding (the government has a stake of up to 67% in each fund) alongside private sector investment.

The principle is simple; for a stake in their business, SMEs have access to investment, usually over a 10-year period, after which they pay back the funds plus interest. The funds are organised by government agency Capital for Enterprise.

Who can apply: Most SMEs, although hi-tech companies are the most successful.

How to apply: Capital for Enterprise

Further information: Capital for Enterprise

 

The Regional Growth Fund is a £1.4bn fund that “supports projects and programmes that lever private sector investment creating economic growth and sustainable employment.”

The Fund, although available across the whole of England, is aimed at areas that are presently dependent on the public sector to make the move to sustainable private sector-led growth.

 At any one time there are literally thousands of European, national and local grant schemes. The European Union has schemes for businesses of all sizes with the money usually given out through the European Commission. Further information is available here: Your Europe and Access2Finance.

Within the UK there are numerous departments and agencies with grants available such as the Department for Business, Innovation and Skills and the Welsh Development Agency.

As well as thousands of schemes to choose from, to add to the confusion there are also many different types of funding available. Here we look at some of the common finance options open to small businesses:

Repayable grant – Funding in which the grant is paid off out of future income, but if the business fails it doesn’t have to be paid thus reducing the risk for the enterprenuer.

Soft loan – A loan in which the repayment terms are better than regular loans such as lower or no interest or longer repayment periods.

Direct grant – A scheme in which the business puts in around 50% of the cost. These grants are given for areas such as training and employment.

Equity finance – When a capital sum is given to a business in return for an equity share of the business, and then when the value of the company grows the stake can then be returned to the investor.

Subsidised consultancy – Unsurprisingly new businesses often lack certain skills, and there are schemes available offering these for free or at subsidised rates.

The StartUp Revolution links page has over 100 business links including many relating to finding business funding.
You can also try these:

Business Link has a Grants and Support Directory where you can search grant schemes by sector or location.

GRANTfinder is a grants and policy database includes details of over 7,000 funding opportunities.  

UK Business Funding Centre