New Start Capital

Who is eligible for New Start Capital?

Businesses that have been trading for less than two years, or that are pre-revenue but have a credible business plan in place, can apply. The business must be UK-based, and the owner must be over 18. Beyond that, the key requirements vary by lender.

In the absence of trading history, lenders focus on two things above all else: the viability of the business plan and the personal credit history of the owner or director. A well-structured plan that demonstrates how the funding will be used and how the loan will be repaid is not optional, it’s the primary basis on which the decision is made.

Personal credit history matters because it’s the closest available proxy for financial responsibility when there’s no business track record to examine. A clean personal credit record doesn’t guarantee approval, but a poor one will narrow the options available.

How much can I borrow with New Start Capital?

Loan amounts for new start businesses typically range from £1,000 to £25,000 for unsecured options. Government-backed Start Up Loans sit within this range. For businesses with some early trading evidence and a strong plan, higher amounts may be accessible, particularly through alternative lenders who take a broader view of eligibility.

The amount offered will reflect the lender’s assessment of the business’s ability to repay, based on the projected cash flow in the business plan. Asking for significantly more than the plan supports is unlikely to result in approval. Asking for what’s genuinely needed and evidencing how it will be repaid is the more productive approach.

Secured new start options, where the borrower has property or assets that can be used as security, can unlock larger amounts. Homeowner business loans, for example, can give new business owners access to substantially more than unsecured startup loans.

Do I need a business plan to apply?

Yes, and not just as a formality. For new start funding, the business plan is the primary document the lender uses to assess the application. It needs to demonstrate: what the business does, who the customers are, how it generates revenue, what the funding will be used for, and a realistic financial forecast showing that repayments are achievable.

It doesn’t need to be exhaustive, lenders aren’t looking for a 40-page strategy document. But it does need to be credible. Realistic projections, a clear route to revenue, and a sensible plan for the use of funds go a long way. Overly optimistic forecasts with no supporting logic are a common reason applications stall.

If you need help structuring a business plan, our account managers can point you in the right direction before you apply.

What can New Start Capital be used for?

New start cash flow funding is unrestricted in purpose, that’s what distinguishes it from asset finance, which is tied to a specific purchase. Common uses include initial stock purchases, marketing and advertising to acquire the first customers, hiring early staff, fitting out or equipping premises, covering operating costs in the early months before revenue is established, and managing the gap between delivering work and receiving payment.

It can also be used to cover predictable early-stage costs that often catch new businesses off guard: VAT registration costs, professional fees, insurance, or the deposit on business premises. Essentially, anything the business needs to get established and generating revenue.

Will I need a personal guarantee?

In most cases, yes. A personal guarantee is standard for new start lending precisely because there’s no trading history to assess. It means the business owner is personally committing to repay the loan if the business can’t. It’s a serious commitment, and understanding its full implications before signing is important.

That said, it’s a normal part of starting a business with external funding, most new business owners encounter personal guarantees across multiple products and arrangements in the early years. What matters is being clear on the maximum liability and confident that the business model genuinely supports repayment.

Government-backed Start Up Loans do not require a personal guarantee beyond the standard application process, which makes them one of the more accessible routes for new starts with limited personal assets.

How long does funding take to arrange?

For government-backed Start Up Loans, the process typically takes two to four weeks from submission of a complete application. The business plan review accounts for most of the time. Alternative lender routes for new start unsecured funding can move faster, sometimes within five to ten working days for straightforward applications.

The single biggest factor in speed is how prepared the application is. A complete business plan, personal bank statements, identification, and a clear statement of what the funds will be used for, presented together at the point of application, eliminates most of the back-and-forth that causes delays.