Business grants and soft loans

Introduction

There are over 1,000 different grants and 'soft loans' available to UK businesses provided by well over 100 different organisations. Sig Biz Advisors works with leading grant specialists to provide companies with the best in class service.

Sources providing grants include local & national government, the European Union and charitable foundations. The grant specialists apply and negotiate for grants every day of the year. It is an unfortunate fact that many companies do not get the grant they deserve because their application left out critical information or did not present their case in the optimal manner.

What can I get grants for?

In all areas of the country there are grants for certain projects involving some form of technical advance, research & development or training. In some cases there may also be grants for consulting, marketing and marketing research. In assisted areas only there are grants for creating jobs, buying capital equipment, developing premises, and a range of other forms of business development.

What chance does a small company have of getting a loan?

Many providers of grants and subsidised loans actually discriminate in favour of small and middle sized companies (SMEs).

Despite this fact, most grant money goes to big companies. The reason is that most SMEs either do not know about the grants or apply for them in the wrong manner and are then rejected. To maximise your probability of success you need expert help from those who regularly apply for grants.

What is a Soft Loan?

Soft Loans are loans offered on more favourable terms than those available commercially. The ways they differ from commercial loans can vary. Typically they will have one or more of the following characteristics:

• a lower rate of interest. Some EU subsidised loans may charge less than half the rate of a high street bank.
• A repayment holiday before you must start repaying.
• Offering to act as a guarantor or otherwise arrange for a business loan without the need for you to provide security

Grants V Soft Loans?

The benefit of a grant over a loan is blindingly obvious - you don't have to repay a grant providing you stick to the agreed rules!

Whilst this is true, be aware that grants are rarely offered for more than 30% of the total cost whilst Soft Loans will typically offer up to 50%, and occasionally as much as 75% towards the cost. Discretion on the use of the money within the overall agreement may also be greater when using a subsidised loan as opposed to a grant.

Additionality : what it means

Grants and soft loans are established by the various funding agencies for specific purposes, but almost all depend on the degree of "additionality" the grant will enable.

Additionality is a word made up by bureaucrats to confuse. It is worth knowing some of the jargon however. It simply means they want evidence that should they provide a grant it will permit you to develop a project faster, start it earlier, or fund a project that might otherwise not be within your means and sometimes a combination of all three.

Whilst the speeding up of a project may be grounds for a grant you should be aware that if this is viewed as the only benefit arising then usually the amount granted will be a lower proportion of the total project cost.

Not in the normal course of business

Another important point about grants is that they are not available for something that, in the normal course of business, you would do anyway.

Usually not for projects already started

This is in part an extension to the two points above. Many grant providers take the view that if you have started a project then you don't really need the grant and will reject such an application. Occasionally you can salvage this situation by dividing the project into stages. Arguing you have done stage 1 but need the grant for stage 2. This is by no means a guaranteed strategy. Whenever possible it is better to seek the grant before you start the work at all.

How long does it take to get?

From the time all supporting information has been submitted grants typically take between 2 and 4 months to be given. Note that delays are often caused by not submitting all required information on the first attempt.

Improve your chances of success in getting a grant

Give us a ring and talk about your ideas. We will meet with you to discuss an idea and arrange for an initial grant search free of charge . If a realistic opportunity for a grant exists we will then introduce you to specialists grant specialists. All of the work by the specialists in indetifying the best sources for grants, liaising with the grant authorities, and completing the forms is carried out on a 'No-Win No-Fee' basis. You should be aware that ,any grant applications require a sound business plan to be submitted with the application. If you need help to develop the accompanying business plan then this work may incur a charge.