What Grants are Available for Businesses in Wales, UK
The Single Investment Fund in Wales includes many grants that were separate programs prior to April 17, 2008. All of these grants are discretionary, so the applicants do not have a right to any funds. Applicants for these business grants generally must establish a legitimate need for the funds and show that the funds will protect jobs.
The SIF has a total budget of about £92m per year. It is a merger of the following grant programs:
- Regional Selective Assistance
- Assembly Investment Grant
- Property development and tourism section 4 grants
Applicants only need to complete one application form to apply for SIF grants. The initial point of contact for the application process is a customer relationship manager from the Welsh Assembly Government.
RSA grants are available for capital funding through Wales except in Tier 3, which is in parts of Cardiff, Flintshire and Newport. The grants start at £100K and have no specific upper limit. RSA grants must create new jobs or protect existing jobs.
AIGs are available to small and medium-sized enterprises throughout Wales. These grants have no minimum and the maximum amount is £75,000. SMEs do not need to create jobs to qualify for an AIG.
WAG scrutiny over grants is much stricter under SIF in order to reduce the dependency on grants. This scrutiny will expect improvement in the following areas:
- Return on investment
- Profit margins
- Employee income
An SIF grant may take the form of a soft loan in which the terms for repayment are more generous than of a commercial business loan. The Small Firm Loan Guarantee Scheme guarantees soft loans for firms that have viable proposals but lack security. The business can use this loan for most purposes, but there are some restrictions.
SIF loans may also provide equity financing. The funder receives an equity share in the business rather than repayment of the loan in this type of financing. The expectation with equity financing is that the value of the share will eventually increase in value.
An SIF grant can take the form of a subsidized consultancy. This type of funding is most useful for a new company that needs a particular set of skill to succeed. The grant pays for all or part of an approved consultant’s fees for a specific time.