The British Business Bank has exceeded the £1bn mark for its flagship debt programme backing start-up businesses.
The economic regeneration bank of the Ƶ Government, which has a Ƶ-wide funding remit, launched its Start Up Loans initiative in 2012. Since then its providing just over £1bn in loans, providing up to £25,000 with a current fix rate of 6%, to more than 105,000 nascent firms.
Welsh businesses have received more than £46m through 4,500 loans with an average amount of £10,000 - slightly higher than the Ƶ average of £9,547.
On a local authority basis the biggest recipients to date are Swansea (£5.9m), Cardiff (£5.4m), Newport (£2.9m), Carmarthenshire (£2.8m), and Caerphilly (£2.8m).
Ƶ-wide £201m (20%) of the £1bn has been lent to people from black, Asian and other ethnic minority backgrounds.
Just 4% of the Ƶ’s small businesses in 2021 were majority-led by people from an ethnic minority group and only 20% of new businesses had female founders according to The Rose Review. The British Business Bank said its Start Up Loans programme provides a means of reaching under-represented groups who are excluded from mainstream finance by helping them start businesses.
In Wales, recent figures show that less than 3% of small businesses are majority-led by people from an ethnic minority group and of the £45m delivered in loans to Welsh businesses, more than £4m (8%) has been lent to people from black, Asian and other ethnic minority backgrounds (not including white minorities).
The data also reports that across the Ƶ, £371m (40%) has been lent to female business owners.
Young people between 18-24 years old have received £106m (11%) in loans since the programme began.
In Wales, 18-24 year olds make up 10% of individuals who have received Start Up Loans, totalling just over £5m, while 31-49 year olds have received just under £25m in loans, making up 53% of all Start Up Loans delivered in Wales since 2012.
One recent Start Up Loans recipient in Wales is Dave Cushley, who took out a loan of £10,000 in February.
Mr Cushley, 41, a trained sommelier and former restaurant manager, recently established an independent wine shop which sells a range of locally and sustainably produced wine from Wales, including Narberth-based Velfrey Vineyard and Carmarthenshire-based Hebron Vineyard, as well as an array of wines from smaller-scale producers across the world.
His shop, Feral Pig Wines, is based in the grounds of boutique hotel, Llys Meddyg, in Newport, Pembrokeshire.
Mr Cushley said: “My Start Up Loan provided the funds I needed to be able to get my business up and running, something I’d dreamt of for a long time. The loan allowed me to purchase all the stock I needed to open the shop, and I’ve also now been able to expand the business further to facilitate online orders and delivery, as well as opening every evening as a wine bar in addition to the shop. To put it simply, without the financial backing I received from the British Business Bank I just wouldn’t have been able to get Feral Pigs Wine off the ground.”
Susan Nightingale, Ƶ network director for the devolved Nations, British Business Bank, said: “It’s fantastic to see Start Up Loans has delivered over £1bn worth of loans across the Ƶ to date, and also to have reached over £46m worth of funding to businesses in Wales. Entrepreneurialism and innovation across Wales and the rest of the Ƶ has seen the Bank support some brilliant businesses, including Feral Pig Wines, which we hope continues to grow with success. We look forward to seeing what the next generation of Welsh entrepreneurs can achieve, and we’re proud to continue to support small businesses through our Start Up Loans funding and post loan support.”
Ƶ Government Small Business Minister, Kevin Hollinrake, said: “Across the Ƶ, thousands of small businesses have now been supported by over a billion pounds in Start Up Loans.
“This crucial support is enabling enterprising companies like Feral Pig Wines start and scale up their ventures and I urge even more to follow in their footsteps.”
In November the British Business Bank will launch its £130m investment fund for Wales. The fund will be made of three elements, small loans, larger loans and equity. Each element will be managed by fund managers following a competitive tendering exercise.
