The loans will support innovations deemed to have the strongest potential to support future economic growth and tackle social challenges, across fields such as net-zero, health and wellbeing, and next-generation digital technologies, as well as the ‘7 Technology Families’ of the Innovation Strategy - advanced materials and manufacturing; engineering biology; electronics; sensors; photonics and quantum; and robotics and smart machines.

The funding, to be delivered through Innovate UK, will be available to SMEs over the next 3 years and will prioritise projects focused on the most important areas of the future economy as set out in the Innovate UK Plan for Action. Businesses can apply for funding through the Innovation Funding Service.

The loans are part of the government’s plan to build on the measures outlined last year in its Innovation Strategy, enabling UK innovators to access the right finance at the right time in order to grow.

Projects supported via the successful loan programme to date have included portable freezers able to safely deliver vaccines to care homes and surgeries, a platform designed to protect hospitals and healthcare centres from cyber-attacks during the pandemic, and patented hospital screens preventing the transmission of pathogens and viruses.

Businesses with innovative late-stage projects can apply for a loan between £100,000 and £2 million, with flexible repayment terms to help secure their future growth and commercial success.

The new full-scale programme will start with monthly competition rounds, for which applicants will need to demonstrate evidence of a high quality proposed innovation project, suitability to take on a loan, and inability to access finance for their project from commercial finance providers.

Indro Mukerjee, CEO of Innovate UK, said: “Innovation loans are an important part of the investment support that Innovate UK offers to help UK businesses achieve their growth ambitions. We have tested this new form of support rigorously and I am pleased that we can now offer £150 million over the next 3 years through innovation loans as part of our commitment to support innovative businesses to grow rapidly and achieve scale.

“The innovation loans scheme is just one of the services to growing and scaling businesses across the UK. Our wrap-around support now includes greater access to Innovate UK EDGE, a business advisory service; and Innovate UK KTN, more opportunity for businesses to connect with potential academic and business partners to help scale in the UK and abroad.

“Allied with this is our continued work with the British Business Bank and private finance to provide further backing for UK innovators.”