By Marcus Leach
News that David Cameron is to expand the start-up loans schemes aimed at young entrepreneurs has, on the whole, been welcomed by business community.
Originally aimed at 18-to-24-year-olds, the scheme, which offers loans of up to £2,500, is now being expanded to those aged up to 30. Further to that the pot for lending will swell from £82 million to £112 million.
However, there were also words of caution, suggesting that whilst the improvements will help, there is still room for further improvement.
John Walker, National Chairman, Federation of Small Businesses, said that any increase in lending to those wishing to start their own business is a positive move.
“Finance continues to be hard to get for people that want to set up a business, so it is good news that more funding is now available to more people," he said.
"However, in some cases £2,500 may not get a business very far so we would call for a more flexible approach where a start-up could apply for more if needed. We also believe that delivery of this finance should be through the business bank once it is established so that all Government finance initiatives are housed under one roof.”
His views were supported by Ben Dowd, O2 Business Director.
“Today’s announcement is a positive step towards generating future growth," said Dowd. "It’s clear from our own research, which showed that almost a third of 16-24 year olds would like to start their own business, that young people’s appetite is undiminished by the recession.
"However, the Government alone cannot unlock Britain’s full entrepreneurial potential. Innovative Government led schemes that create pathways into entrepreneurialism are extremely welcome, but we must not ignore the role large established firms can play to ensure that start-ups stay the course.
"Whether through mentoring, funding or training, large businesses can help catalyse the success of young start-ups and SMEs and re-ignite our economic recovery.”
Lee Perkins, Managing Director, Small Business Division at Sage UK, said the news was a late, but very welcome, Christmas present for the start-up community.
"Today's announcement is a late but very welcome Christmas present for the UK's startup community," Perkins said.
"Our own research has revealed that access to finance is one of the biggest barriers for would-be entrepreneurs and opening up the scheme to more people should give UK PLC a real boost in 2013.
"Whilst it is good news that the age limit has been raised to 30, it's not just young people that are responsible for driving continued economic growth - the government needs to ensure that support and mentoring is available for entrepreneurs of all ages."
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