£500M for IP-Rich SME Lending

For SMEs whose value lies in software, technology, data and know-how, this could mark an important shift in how lenders assess innovation-led businesses.

One of the most significant points in the Government’s latest SME finance announcement is the allocation of £500 million to help unlock lending for innovative, IP-rich businesses.

For many companies undertaking R&D, value sits in software, technology, data, intellectual property and technical know-how, rather than traditional assets that lenders readily recognise.

As a result, highly innovative businesses can struggle to access finance despite having developed valuable technology.

This announcement suggests that may be starting to change. The detail will determine the impact, but the direction is encouraging. It also reinforces the importance of properly identifying, evidencing and communicating the value created through R&D.

A positive step for innovative UK SMEs.