Can I get a grant to start a business in the UK?

Yes — there are several grants available for new and small businesses in the UK. Government-backed options include Innovate UK grants (for innovative businesses), the Start Up Loan scheme (technically a loan at 6% fixed, but up to £25,000 per person), and various local enterprise partnership grants. Some councils offer specific grants for small businesses in their area. There are also grants for specific groups — women in business, young entrepreneurs, veterans, and businesses in disadvantaged areas. Grants don't need to be repaid.

What's the difference between a grant and a loan?

A grant is FREE money — you don't have to pay it back. A loan must be repaid, usually with interest. Grants typically require a detailed application, have specific eligibility criteria, and may come with conditions (e.g. the money must be spent on particular things, and you may need to report on how you used it). Grants are more competitive — there are more applicants than available funding. Loans are generally easier to access but cost you money over time.

How do I find grants for my business?

The best starting points are: gov.uk/business-finance-support (government tool listing grants by area and sector), your local council or Local Enterprise Partnership (LEP) website, Innovate UK for innovation-focused businesses, the British Business Bank, and the Prince's Trust for under-30s. Also check sector-specific bodies — many industries have dedicated funding programmes. Be cautious of paid 'grant finder' services — most legitimate grants can be found for free.

What can grants be used for?

It depends on the grant. Common permitted uses include: equipment and technology, research and development, hiring staff, training and skills development, marketing and exporting, premises costs, and specific projects outlined in your application. Most grants specify what the money can and cannot be used for. Many require match funding — you contribute a percentage of the total project cost from your own funds. Always check the terms before applying.

Small Business Grants UK 2026 — Free Funding You Can Apply For | PocketWise

Grants are free money for your business — you don’t pay them back. Here’s what’s available in 2026.

Main UK Business Grants

Government and National Schemes

Grant/Scheme	Amount	Who it’s for
Innovate UK Smart Grants	£25,000–£500,000	Innovative businesses developing new products, services, or processes
Innovate UK Catalyst	Varies by competition	Sector-specific innovation (e.g. net zero, health, AI)
Start Up Loan	Up to £25,000 per person (6% fixed interest — technically a loan)	New businesses under 3 years old
Knowledge Transfer Partnership (KTP)	£25,000–£300,000	Businesses partnering with universities on innovation projects
Small Business Research Initiative (SBRI)	Up to £1 million+	Businesses solving government challenges through innovation
Export grants (UK Export Finance)	Varies	Businesses looking to sell internationally
Growth Hub grants	£1,000–£25,000	Via local Growth Hubs — business development, equipment, digital adoption
Help to Grow: Digital	Up to £5,000 (50% discount)	SMEs adopting approved digital software

Devolved Nations

Area	Scheme	Amount
Scotland	Business Gateway + Scottish Enterprise + HIE grants	Varies — up to £150,000+
Wales	Business Wales grants + Development Bank of Wales	Up to £50,000+
Northern Ireland	Invest NI grants + Enterprise NI	Up to £50,000+
England (regions)	Local Enterprise Partnership (LEP) grants	Varies by region — £1,000–£50,000

Sector-Specific Grants

Sector	Grants available
Green/sustainable business	Net Zero grants, IETF, Green Business Fund
Agriculture	Farming Innovation Programme, ELMS
Creative industries	Arts Council, Creative Scotland, BFI
Technology	Innovate UK, UKRI Digital
Social enterprise	Big Lottery Fund, Power to Change, UnLtd
Food and drink	AHDB, Innovate UK Food
Manufacturing	Made Smarter, Innovate UK

Grants for Specific Groups

Group	Scheme	Detail
Under 30	Prince’s Trust Enterprise Programme	Funding, mentoring, and support
Women	Various (Natwest Back Her Business, AllBright)	Funding and mentoring for female founders
Veterans	X-Forces Enterprise	Start-up support and grants for ex-military
Disabled entrepreneurs	Leonard Cheshire, various council schemes	Adapted support and funding
Ethnic minority businesses	Various (MSDUK, regional schemes)	Dedicated funding programmes

How to Apply Successfully

Step	Action
1	Check eligibility carefully before applying — don’t waste time on grants you don’t qualify for
2	Read the guidance thoroughly — follow instructions exactly
3	Write a strong business case — clearly explain what you’ll use the money for and the expected impact
4	Show match funding — many grants require you to contribute a percentage
5	Provide evidence — financial forecasts, market research, team credentials
6	Meet the deadline — late applications are rejected
7	Follow up if you don’t hear back within the stated timeframe

What Makes a Strong Application

Element	What assessors look for
Clear objectives	Specific, measurable goals for how you’ll use the money
Innovation	What’s new or different about your approach (especially for Innovate UK)
Market evidence	Proof there’s demand for your product/service
Financial viability	Realistic forecasts showing the business can sustain itself
Team capability	Skills and experience to deliver the project
Impact	Job creation, economic growth, environmental benefit, social impact
Value for money	Costs are reasonable and justified

Start Up Loan — The Most Accessible Option

Feature	Detail
Amount	£500–£25,000 per person (up to £100,000 for partnerships)
Interest rate	6% fixed per annum
Repayment	Over 1–5 years
Eligibility	UK resident, 18+, business under 3 years old, viable business plan
Free mentoring	12 months of mentoring included
No early repayment fees	Can repay early without penalty
Personal guarantee	No — it’s an unsecured personal loan
How to apply	startuploans.co.uk

Other Funding Sources

Source	Type	Detail
British Business Bank	Various	Connects businesses with finance options
Regional funds	Grants + loans	Northern Powerhouse, Midlands Engine, etc.
EU replacement funds	Grants	UK Shared Prosperity Fund, Levelling Up Fund
Charitable trusts	Grants	Lloyds Bank Foundation, Esmée Fairbairn, many others
Crowdfunding	Equity or rewards	Crowdcube, Seedrs, Kickstarter

Warning: Grant Scams

Red flag	Detail
Upfront fees	Legitimate grants don’t require payment to apply
Guaranteed approval	No grant is guaranteed before assessment
Unsolicited contact	Be wary of cold calls or emails claiming you’ve “been selected”
Pressure to act fast	Legitimate schemes have published deadlines, not verbal pressure
Paid grant-finding services	Most legitimate grants can be found free via gov.uk

Small Business Grants UK 2026 — Free Funding You Can Apply For

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