Innovate UK Innovation Loans

Innovate UK Innovation Loans (Round 22) – Up to £5 Million in Flexible Funding

Support for late-stage R&D and commercial innovation, now with increased flexibility and funding limits

The latest round of the Innovate UK Innovation Loans Future Economy competition (Round 22) is now open. From 3 July to 27 August 2025, UK-registered SMEs can apply for £100,000 to £5 million in flexible loan support to fund the development and deployment of late-stage innovations.

This unique public finance mechanism is designed to support commercially-focused R&D and early market entry. Loans are non-dilutive, low-interest, and structured to work alongside your growth strategy, particularly if equity or commercial lending is unavailable or unsuitable.

What Are Innovate UK Innovation Loans?

Innovation Loans are low-interest loans provided by Innovate UK (part of UKRI) to support:

Late-stage R&D and commercialisation activities
Projects that have potential to generate significant economic impact
SMEs with clear business models and robust financial management

Key Features of Round 22

Loan size: £100,000 to £5 million (updated from £2 million)
Coverage: Up to 100% of eligible R&D and scaling costs
Interest: 3.7% during development and extension phases, rising to 7.4% during repayment
Terms: Up to 7 years in total, including repayment deferral for the first 3 years
Ownership: Non-dilutive – you retain full equity

Unlike grants, these funds must be repaid, but terms are significantly more favourable than commercial loans.

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Who Is Eligible?

To qualify, your company must:

Be a UK-registered SME
Demonstrate strong innovation potential and a credible route to market
Show ability to repay based on cash flow forecasts
Undertake a project that fits Innovate UK’s loan competition scope

Eligible activities include:

Technical R&D and testing
Tooling and capital equipment
Staffing and materials directly related to development
Compliance, certification, and market trials
New in Round 22: Marketing, customer testing, and capital deployment to support early market entry

FI Group assists in assessing eligibility and preparing robust applications that meet financial and technical due diligence standards.

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Who Is Eligible?

To qualify, your company must:

Be a UK-registered SME
Demonstrate strong innovation potential and a credible route to market
Show ability to repay based on cash flow forecasts
Undertake a project that fits Innovate UK’s loan competition scope

Eligible activities include:

Technical R&D and testing
Tooling and capital equipment
Staffing and materials directly related to development
Compliance, certification, and market trials
New in Round 22: Marketing, customer testing, and capital deployment to support early market entry

FI Group assists in assessing eligibility and preparing robust applications that meet financial and technical due diligence standards.

Book A Meeting

Typical Project Use Cases

Final development and testing of new technologies
Regulatory approval and market validation
Product launch and scale-up
Building commercial teams or operational capacity

Loans support projects that are too risky for traditional finance but too advanced for early-stage grants.

Benefits of Innovation Loans

Non-dilutive funding – retain equity and control
Larger project budgets than typical innovation grants
Flexible repayment aligned with business growth
Validation from a leading UK funder

Loans can be used alone or in combination with grant funding, provided there is no duplication of cost coverage.

Application Process

FI Group guides you through each stage of the competitive process:

Competition Selection: Identifying suitable Innovate UK Innovation Loan calls
Project Scoping: Aligning your project with funding objectives
Application Preparation: Crafting a compelling proposal covering:
- Innovation description
- Market opportunity and commercial model
- Financial forecasts and repayment plan
Review & Submission: Ensuring compliance and maximising scoring potential
Post-Award Support: Assisting with drawdowns, monitoring, and reporting

Aligning Loans with Broader Innovation Strategy

Innovation Loans are one part of a broader innovation finance strategy. FI Group helps you:

Sequence funding from grants, loans, and tax relief
Manage project finances and optimise claim timing
Build a sustainable innovation pipeline with minimal cash flow disruption

Innovate UK Innovation Loans – 2025 Guide Unlock Flexible, Non-Dilutive Funding for Late-Stage R&D and Commercialisation

Innovation Loans from Innovate UK offer growing SMEs a rare opportunity: patient, low-interest capital with zero equity dilution. But navigating the application process requires strategic clarity and precision.

Our new 2025 UK Guide to Innovation Loans demystifies the entire process—from eligibility to repayment—with expert advice from FI Group’s funding consultants.

Download the free guide to maximise your chances of success in upcoming rounds.

Download the Guide

Innovate UK Innovation Loans – 2025 Guide Unlock Flexible, Non-Dilutive Funding for Late-Stage R&D and Commercialisation

Our new 2025 UK Guide to Innovation Loans demystifies the entire process—from eligibility to repayment—with expert advice from FI Group’s funding consultants.

Download the free guide to maximise your chances of success in upcoming rounds.

Download the Guide

Why Work with FI Group?