Demand for start up finance suggests a continued entrepreneurial drive
The British Business Bank’s Start Up Loans programme saw a 9% rise in loan volumes in 2025 compared to the previous calendar year, suggesting a continued entrepreneurial drive in the UK. This is the same rate of growth as 2024 had versus 2023. December was a particularly strong month, with the volume of loans up 12% in December 2025 compared to December 2024.
39% of the Start Up Loans in 2025 went to female business founders, while 21% went to ethnic minority groups and 8% went to young Gen Z entrepreneurs aged between 18 and 24. All three groups traditionally struggle to access start up business financing.
The 2025 calendar year also saw demand for Start Up Loans remained broadly consistent in each quarter.
Each quarter was as follows:
January-March: 2,805 loans worth £35.92m
April-June: 2,861 loans worth £36.93m
July-September: 2,936 loans worth £36.18m
October-December: 2,738 loans worth £34.08m
The demand for Start Up Loans runs counter to some other findings around business confidence. The British Chambers of Commerce found in their latest survey that confidence among businesses has fallen, with only 46% of responding firms expecting an increase in turnover (compared with 48% in Q3), meaning it is at its lowest level in three years. Furthermore, the Lloyds November Business Barometer found that business confidence fell in November by eight points to 42%.
Louise McCoy, managing director, Start Up Loans Products, British Business Banksaid: “Despite a mixed picture when it comes to business confidence data, in our Start Up Loans drawdowns data we still see a picture of year-on-year demand holding up.
“December and January is a period when many people have the time and motivation to explore setting up their own business and change direction. We have already seen December 2025 delivered a much higher volume of loans than December 2024.
“With demand for small business finance from Start Up Loans ticking up, we look forward to supporting more entrepreneurs throughout 2026.”
January is traditionally a time when small businesses look to start up or look for external finance. Start Up Loans has found that the period between Christmas and New Year was a time many aspiring entrepreneurs used to find out more about setting up a business.