How much can I borrow from the Start Up Loans scheme?
Short answer
Between £500 and £25,000 per person at a fixed 6% a year, over one to five years, with no arrangement fee and no early repayment charge. Each co-founder can apply separately, so two people could raise up to £50,000. The average loan approved is around £7,500.
The Start Up Loans scheme is delivered by the British Business Bank and is one of the most accessible forms of finance for a new business — but it is important to understand what it actually is. It is a personal loan, not a business loan. It is assessed against your personal credit history and you remain personally liable for it whatever happens to the business.
Eligibility and terms
- Aged 18 or over, based in the UK, with a business idea or a business trading for fewer than three years.
- £500 to £25,000 per person, at a fixed 6% annual rate over one to five years.
- No arrangement fees and no early repayment charges — on a £7,500 loan over three years the total interest is around £720.
- 12 months of free mentoring with every approved loan, typically monthly sessions matched to your sector and stage.
A poor credit history does not disqualify you automatically; the scheme is deliberately more accessible than commercial lending. What you must show is that the business can generate enough to repay. Active CCJs, recent defaults or a recent bankruptcy will weigh against you.
Applying, and what happens if it goes wrong
Applications go through accredited delivery partners — enterprise agencies, incubators and support organisations listed on the Start Up Loans website — not directly to the British Business Bank. The partner helps you free of charge with the business plan and forecasts, reviews the application, and may ask for revisions before submitting it for credit assessment. You will need a business plan, a 12-month cash flow forecast and a personal survival budget. Most decisions take four to eight weeks from a complete application.
Because it is a personal liability, default matters. Missing two or more consecutive repayments triggers contact from the delivery partner or the Bank; the first response is normally a revised payment plan, a payment holiday or a deferral. If the business has failed the debt does not disappear — it can be pursued through the courts, and a resulting CCJ will sit on your credit file for six years. Speak to the delivery partner early, because the options narrow once arrears build.
A Start Up Loan can sit alongside a grant, and it can sometimes count towards a match-funding requirement — declare it either way, and check the grant's rules on repayable finance before relying on it.
Related guides
Start Up Loans: Full Guide
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