As an unemployed aspiring entrepreneur, it can feel as though there’s little financial support available to help you start up a business.
Banks scrutinise your credit history before loaning you a small business grant, while investors may be hesitant to back a concept which you haven’t had the resources to test or prove. Mentorship and peer support, too, seems to come more easily to those who already have contacts in the business world.
Thankfully though, there are a range of ways unemployed entrepreneurs can gain financial support – and one of the most popular is through business grants.
What grants are available to unemployed people?
There are currently thousands of grant schemes in action across the UK, each with its own strict set of eligibility criteria based on what your business aims to achieve, where it will be based, and more.
If you’re not in work, you’re by no means limited to schemes which are specifically for unemployed people – and there are plenty of other grant awarding bodies out there who will accept applications from unemployed as well as employed people.
However, with so many schemes available and all for different purposes, it’ll likely save you time and energy to narrow down your search specifically to business start-up grants for the unemployed as you’re likely to fit their selection criteria, and they’re likely to provide you with what you most need.
First off, we would recommend looking into the New Enterprise Allowance (NEA) scheme.
New Enterprise Allowance (NEA)
What is New Enterprise Allowance?
Run and provided by the government, the New Enterprise Allowance scheme aims to help unemployed people become self-employed and start their own businesses.
What will I get from New Enterprise Allowance?
If you’re eligible and your application for NEA is successful, you’ll first be matched up with a business mentor. They will provide you with business advice and help you to write a business plan.
Once you’ve completed your plan and it has been approved by your mentor, you can apply to receive a weekly allowance, worth up to £1,274 and given to you over 26 weeks, as part of your NEA participation. You might also then be able to apply for a further loan of up to £1,000 from the government to assist with start-up costs.
Your mentor will continue to guide you, helping you to launch your start-up and begin trading.
Am I eligible for New Enterprise Allowance?
You’re eligible for NEA if:
- You’re 18 or over
- You or your partner receive Universal Credit, Jobseeker’s Allowance or Employment and Support Allowance, OR…
- You get Income Support and you’re ill, a single parent or have a disability
How can I get New Enterprise Allowance?
To enquire about receiving New Enterprise Allowance, you can either discuss it with your Jobcentre Plus work coach or call the Universal Credit helpline.
Other UK schemes
If NEA doesn’t sound right for you – or if you want to explore more options before settling on one – there are plenty more UK-wide schemes which can help unemployed people to get started on their business dreams.
If you’re aged 18 to 30, you might be eligible for a grant from the Prince’s Trust, which offers financial help to young entrepreneurs who are either unemployed with limited means or are working less than 16 hours per week.
Learn more about the Prince’s Trust and its Enterprise Programme here.
Or, if you’re unemployed following service with the armed forces, you might be eligible for the Royal British Legion’s Be The Boss scheme.
This can provide veterans and service men and women a business grant of up to £7,500, a loan of up to £30,000, or a combination of both (though the amount awarded will never exceed £30,000).
To seek out more options, try consulting the government’s online finance finder tool.
Local schemes
Alongside the above schemes, which are available on a national scale, you might find that your local council offers an initiative to help unemployed people to start and/or grow their own businesses in your area.
For example, Broadland District Council’s start-up grant offers £750 to support unemployed aspiring entrepreneurs in the Broadland District of Norfolk. Applicants must submit a business plan and cashflow forecast, and their business must not have started trading yet.
To find out whether your local authority offers a grant scheme that’s suited to your situation and your business, get in touch with them to discuss.
Business grant success story
Graphic designer Kim Gee, founder of Kim Gee Studio, was unemployed when she came across The Micro Business Grant Scheme of the Isle of Man.
The scheme is designed to give budding entrepreneurs and small start-ups the necessary financial support, training and business acumen to get their businesses off the ground.
Here, Gee shares the story of how the grant helped her to launch her studio:
“I moved to the Isle of Man from New York City in 2016, and assumed I’d instantly find work as a graphic designer. I met with recruiters and kept my eyes peeled, but no one was hiring designers at that moment, and I didn’t want to wait around.”After years of being an in-house designer, it was time to finally commit to my side-gig, Kim Gee Studio, providing freelance graphic design and illustration.
“In the first few months of being self-employed, a few local friends asked if I’d heard of the Isle of Man’s Micro Business Grant Scheme. When I looked into the scheme it seemed too good to be true: a free class, with free money at the end? Sign me up.
“I filled out the application and completed the quick course over the summer, and by autumn I had a small weekly stipend hitting my business bank account. I met new friends and started seeing a business mentor quarterly, which meant I finally had someone who cared about the success of my business as much as I did.
“It bolstered my confidence in being self-employed, and happily I’ve never looked back.”
– Kim Gee, Kim Gee Studio
If you need more help in looking for that perfect grant scheme, check out our guides to read more about the business grants available in the UK, and where to find them.
Once you’ve found the grant scheme for you, you’ll need to apply. Business grants are very popular and so competition for them is fierce, but you can give yourself the best chance of coming out on top using our guide to applying for a grant.
Read the full article here
