Government loan scheme’s £33m windfall ‘critical’ to East of England start-ups
- Credit: Archant
A government bank has lent out a total of £32.5m to 4,000-plus start-up businesses in the East of England over the last seven years as part of a national drive to boost the economy.
Of 63,920 British Business Bank Start Up Loans issued across the UK since it was set up in 2012, 4,265 went to aspiring business owners in the east region, with the average loan amounting to £7,628, official figures show. Across the UK, the loan figure has now passed the £500m mark.
Husband and wife team, Kevin and Kellie Bath, of Halstead, north Essex, said their £25k fixed interest loan was critical to the launch of their healthy chocolate spread for children.
They were so shocked by the amount of sugar in his children's favourite chocolate spread they decided to create a healthy alternative.
Kevin, who worked in the Royal Navy for six years before working in IT, founded JimJams, his own range of low-sugar chocolate spreads, jams and marmalades.
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The spreads are now available in major UK supermarkets, including Sainsbury's and Morrisons. The business's annual turnover grew by 106% between 2017 and 2018 and continues to rise.
"High Street banks were only interested in lending to established companies with a substantial turnover, therefore, as a start-up company, this loan was absolutely critical to kick start our business," said Kevin.
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The Start Up Loans programme has lent money and provided mentoring support to aspiring business owners in every part of the country and its impact has been particularly noticeable in areas of deprivation,the government said.
London is the largest recipient, with 14,931 loans worth £118m, followed by the North West with 7,841 worth £60m. The South East comes next with 5,680 loans worth £48m followed by Yorkshire and The Humber with 5,377 loans worth £44m. There were 3,879 loans in Scotland worth £29m and 2,904 loans in Wales worth £26m.
The scheme started in 2012, but in 2018, chancellor Philip Hammond announced it would be extended, with a target of 10,000 additional loans being issued in the year to April 2021.
Patrick Magee, chief commercial officer at the British Business Bank, said: "The hard work and determination of the UK's 5.7m small businesses make a huge contribution to society, and it's great to see latest research showing that the economic benefits of the Start Up Loans programme are nearly six times its economic costs."