Funding from the StartUp Loans programme is being rolled out to young entrepreneurs thanks to initial capital of £10 million. If successful, the project will be bolstered by a further £72.5 million from the Government in 2014/15 to fund start-up capital, training and the support of mentors to young entrepreneurs.
Under the scheme, young people (aged 18-24) who want to set up their own businesses receive loans averaging £2,500 as seed capital to get their businesses off the ground. Loans are charged at 3% over the Retail Price Index and have been fixed at 6% for the duration of the pilot. The scheme hopes to create more than 30,000 new businesses over the next three years.
The scheme’s Pioneer Entrepreneurs were the first to receive funding on 3 October at an event in London. StartUp Loans chairman James Caan and Lord Young of Graffham, enterprise advisor to the Prime Minister, joined ambassadors and a group of successful young entrepreneurs who started their businesses for less than £2,500 as well as new applicants for funding.
Almost 2,000 loan applications have already been received. New corporate support for young entrepreneurs worth an additional £50m has also been announced, from organisations including Regus UK, PayPal, eBay, Magento Go and Metro Bank.
James Caan said: “StartUp Loans Company aims to stimulate entrepreneurship across England and highlight starting a business as a viable career option for young people. I know from personal experience both how exciting and challenging it is to start a business but with the mentoring advice we provide and the corporate support we have from Regus and PayPal we can make a huge difference to these new businesses.”