What is a Startup Loan?
A startup loan is business finance specifically designed for new businesses with limited or no trading history. In the UK, the government-backed Start Up Loans scheme offers personal loans of up to £25,000 per director at a fixed rate of 7.5% per year, repayable over 1 to 5 years and including 12 months of free mentoring. Alternative new business finance options are also available from specialist lenders. Seven Hills Capital Group will identify the most appropriate startup funding route for your business plan and personal profile.
How Startup Loans works in practice
Government-backed and alternative finance specifically for new businesses. Get the capital you need to launch or grow your early-stage company.
How it works
You apply for a startup loan — either through the government scheme or an alternative lender
The lender assesses your business plan, cash flow forecasts and personal credit history
Government-backed startup loans are personal loans used for business purposes
Funds are released upon approval — typically within 2–4 weeks for the government scheme
Government scheme loans include 12 months of free mentoring and business support
Who It Is Right For
- Startup loans are for businesses in their early stages — typically their first five years of trading — that need capital to launch or grow and cannot access mainstream bank lending.
- Particularly suited to sole traders, limited companies and partnerships with a credible business plan but limited trading history.
Pros
- Available to businesses with no trading history — specifically designed for early-stage companies
- Government scheme offers a competitive fixed rate of 7.5% per year
- Free mentoring and business support included with the government scheme
- No early repayment charges on government scheme startup loans
Things To Consider
- Government scheme loans are personal loans — the director is personally liable for repayment
- Maximum of £25,000 per director under the government scheme
- A credible business plan and cash flow forecasts are required
- Not suitable for businesses that need significantly more than £100,000 to launch
Why Use Seven Hills Capital Group
Seven Hills Capital Group will assess whether the government-backed Start Up Loans scheme or an alternative new business finance product is the right route for your situation. We work with specialist lenders that consider early-stage businesses and will identify the most appropriate source of startup capital based on your business plan, sector and personal financial profile.
How Seven Hills Capital Group Could Help Your Business
Every business situation is different. The illustrative examples on our case studies page are based on common scenarios we see from UK business owners and landlords - showing how the right finance product, found through a whole-of-market broker, can make a real difference.
View All Case StudiesFrequently Asked Questions
What is the government Start Up Loans scheme?
The Start Up Loans scheme is a government-backed programme offering personal loans of up to £25,000 per director at a fixed rate of 7.5% per year, repayable over 1 to 5 years. It includes 12 months of free mentoring and is available to businesses that have been trading for up to five years.
Do I need a business plan to get a startup loan?
Yes. Both the government scheme and most alternative startup lenders require a business plan and cash flow forecasts. The quality of your plan is a key factor in approval — Seven Hills Capital Group can advise on what lenders specifically look for and how to present your business credibly.
Can I get a startup loan for a limited company?
Yes. Government scheme startup loans are personal loans made to the director for use in the business. Some alternative lenders will lend directly to a limited company with limited trading history at higher rates.
How much can I borrow as a startup?
Under the government scheme, up to £25,000 per director — so a business with two directors could access up to £50,000 in total. Alternative lenders and specialist new business finance providers may offer more depending on the strength of your business plan and sector.
What can a startup loan be used for?
Stock, equipment, marketing, premises costs, working capital and any other legitimate business startup expense. Startup loans cannot be used to repay existing personal debt or for personal expenditure — they must be used solely for the business.
Not sure if Startup Loans is right for your business?
Our team will tell you honestly in one conversation whether this is the right product for your situation — and if not, what is.