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Have you considered using your invoices to raise finance in 24 hours? Where up to 85% of an invoices value can be obtained as a way of improving your cash flow.
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Assisted Areas There are several assisted areas throughout the country, these are cities or regions with lower than average GDP (Gross Domestic Product). Extra support is available in these areas to help local businesses improve. Assisted areas are rated in one of three tiers, with tier 1 having the highest extra support available, and tier 3 the least. If you are based in an assisted area, then you are likely to have a better chance of obtaining a grant or loan, although there will probably also be more businesses competing for them.
Applying
Applying for a grant or soft loan is usually done through the specific organisation that is offering the funding. The process will vary slightly between the organisations, although most will require the same information.
Before you apply, you need to ensure that you meet the standard criteria for the grant or loan, applying when you are not eligible will cause a lot of wasted time and effort.
You will need to create a project proposal, detailing what you need the grant money for, the aims you have for the project, as well as how and when you hope to achieve them.
It helps to also have a good business plan available, this helps show the organisation that your business has planned effectively, has a good business model, and is worth providing funding for.
As well as a project proposal, you may also need to fill in a specific application form, with detailed questions. You may also be called for a personal interview (particularly for larger grants or loans) to present your case for funding.
Applications can take several months from start to finish, and EU applications can take up to a year to complete even if you are not successful. Generally, the smaller the grant or loan applied for, the quicker the response will be, and you should always allow time for the application process in your planning.
Applying for a loan under the Small Firms Loan Guarantee is different however; the application is made directly through the lender, who decides whether or not to accept it.
The loan guarantee only applies if you meet all the criteria, and are unable to get finance without it.
You do not need to have a project proposal to apply for a loan under the guarantee; however you should have an up to date business plan as a minimum, and any project plans you have will benefit your case for funding.
Finding Grants and Schemes
There are several places to search for grants and schemes across the UK.
The Small Business Service (SBS) and Business Link can give you advice, and help you search for appropriate grants and loans in your area. They can also help you prepare and apply for them.
Remember
Grants are given to your business to help with a specific project. They will only cover up to 50% of the total project costs. Grants are offered mainly by the government, local authorities, business organisations and the EU.
The Small Firms Loan Guarantee offers security on 75% of a loan, meaning that a lender is much more likely to accept your finance application. You can only use the guarantee when you cannot obtain finance because of a lack of security, and you have to pay 2% of the remaining loan to the Small Business Service each year.
A soft loan is a loan from the government or local authority; they have little or no interest and need very little security to obtain. They are seen as a last resort, and will only be obtainable if you cannot find adequate finance through other means.
Awards can provide funding and publicity, however you can never be certain of winning an award, and they should be seen as additional to required finance.
Obtaining a grant or loan will involve writing a detailed project plan with the aim of achieving set goals.
Any grant (or soft loan) you receive will in most cases only make up a maximum 50% of the total project cost; you will have to fund the rest. Loans under the Small Firms Loan Guarantee do not have to be matched or for certain uses unless otherwise stated by the lender.
Grants vary depending on where you are in the UK, and are generally biased towards manufacturing and related services. Assisted areas will have a greater amount of funding for grants and loans, and creating new jobs will help make your application much more attractive.
Many different types of spending qualify for a possible grant, you should however, always be certain that you qualify for a grant before you apply.
Applications can take from several months to over a year to be completed, you should always include this time in any plans, and ensure you are never relying on grant or loan money. Article Index
3. Finding and Applying for Grants |
