Defence Innovation Loans 2023
Loans of up to £2m to help convert your mature defence innovation into a strong business proposition for defence procurement, with a below market interest rate of 7.4% per annum
The Defence and Security Accelerator (DASA) supported by Innovate UK Loans Ltd (Innovate UK) are working together to offer a Defence funding competition: the Defence Innovation Loan. This service provides an opportunity for single small and medium enterprises (SMEs) with solutions to Defence themed problems to apply for a Defence Innovation Loan of between £100,000 and £2 million with a below market interest rate of 7.4% per annum. This loan can be used to cover up to 100% of eligible project costs to aid the commercialisation of the solution. Innovate UK provide further information on innovation loans (not Defence specific) here.
On 13 December 2022, DASA and Innovate UK hosted a live webinar (click here to see the recording) to answer questions about Defence Innovation Loans, where viewers spoke to a panel of experts about how to submit a successful application.
To take on a Defence Innovation Loan for a project you must:
- be a UK registered SME
- intend to exploit the results in the UK or overseas to make a significant and positive impact on the UK economy and / or productivity
- give evidence that your business is suitable to take on a loan.
Only SMEs are eligible to apply for Defence Innovation Loans; individuals, academic institutions, research organisations and large companies are not eligible. Only single businesses can receive innovation loans, so joint applications with other organisations cannot be funded in this competition (subcontractors are allowed, see further details at the link below).
Loans of between £100,000 and £2 million will be offered; applications requesting loans outside of these amounts will be ineligible and will not be considered. DASA will ask you to detail the total costs required for your technical project plan. If you are not requesting a loan to cover all of these costs they will ask you to indicate this and detail where the rest of the funding will come from and how much it is. The amount offered will be based on your technical project plan and Innovate UK’s judgement of the suitability and affordability of a loan for your business. The Innovate UK Loans Ltd credit committee will decide the final terms, amount and length of the loan offer.
Innovations must be fairly mature at TRL 6 and above to ensure that the solution can be commercialised within the time scale of the innovation loan. Applications must clearly evidence a Defence need for the innovative solution.
There are two elements to the Defence Innovation Loan application:
- Innovation Application – submitted through the DASA submission service.
- Innovation Loan Request Application (Business and Financial Assessment) – submitted through Innovate UK, detailed guidance on the application process can be found here.
Your application will not be processed unless both parts of the application (i.e. DASA and Innovate UK) have been completed.
There are three competitions currently planned for 2023:
- Cycle 1: closes on 25th January 2023, decisions expected 14th March 2023
- Cycle 2: opens 26th January, closes 8th March, decisions expected 27th April
- Cycle 3: opens 9th March, closes 18th April, decisions expected 1st June
Before submitting a full application, please speak with your regional Innovation Partner about your idea. To do this please contact DASA to arrange a discussion. As part of your application you will be asked to confirm that you have spoken to DASA regarding your innovation, and that DASA confirmed its suitability for the Defence Innovation Loans competition.
See our Innovation Loans Future Economy programme page for more details, including how to apply for non-defence-related loans.
Innovation Loans Future Economy Competition: Round 7
Opens: 10/11/2022 Closes: 11/01/2023
UK registered businesses can apply for loans for innovative projects with strong commercial potential to significantly improve the UK economy.