What are Innovation Loans?
Innovation Loans offer an opportunity for UK SME’s to be awarded up to 100% project funding for late-stage R&D projects focusing on experimental development, that have a clear route to commercial success.
The Innovation Loans scheme aims to provide finance that is affordable, patient and flexible for these projects. They are aimed at innovative micro, small and medium-sized businesses who will be able to manage a loan, but who struggle to access finance from commercial lenders or schemes backed by the British Business Bank.
The currently open, September round of this competition is the fifth and final part of the pilot scheme that was introduced by Innovate UK in Autumn 2017.
The scope for eligible projects, as defined by Innovate UK, is:
- a clear game-changing and/or disruptive innovative idea
- that your idea can lead to innovative products, processes or services that are significantly ahead of others in the field or that it includes prototyping, demonstrating, piloting, testing and validation in environments that represent real life operating conditions
- 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
What are Innovate UK looking for?
The main things Innovate UK are looking for when assessing your application are:
- That your business will be able to repay the loan (cover interest payments and make the repayments on time)
- That your proposal demonstrates a clear, considerable potential to make a significant and positive impact on the UK economy
- That your proposal demonstrates realistic, significant potential for global markets
To be able to show the assessors that your proposal meets all these points, the application is split into 2 parts…
Part A is for you to describe your project details, answer the innovation questions and explain your project finances.
Part B is to answer questions about your business and its ability to repay a loan. It also gives you the opportunity to outline your preferred loan conditions accompanied with your reasons why.
TBAT Top Tips for applying
- Register to apply on Innovate UK’s secure application submission system with plenty of time to spare. On this online system, you will find all the documentation you need for your application and this is where you need to submit your completed application and appendices. Ensure you understand how it works so you are not late submitting your application.
- Make sure all documents are provided and answered according to the guidelines. There are strict guidelines for the loans competition and any part missing will mean your application is immediately deemed as ineligible and will not be sent for assessment.
- Use the financial template provided by Innovate UK to present your finances in part B. The template is designed to clearly show the assessors the information they need. We also recommend that you provide your financial forecasting in quarters, as this reflects the time frames that the loan repayments will be due.
- If you have any questions about the loans, or your eligibility – contact Innovate UK! They will be able to advise on any questions you may have before applying, or during writing your application!
To find out more about the competition – have a look at the full details here!