UK opens fund to help high-growth firms weather virus crisis

[LONDON] UK companies in high-growth industries can apply to a new £500 million (S$868.7 million) government-backed fund from Wednesday for loans of up to £5 million, to help them weather the novel coronavirus crisis.

The Future Fund is the latest part of Chancellor of the Exchequer Rishi Sunak's unprecedented effort to help the UK economy survive coronavirus.

Mr Sunak warned on Tuesday the country was facing "a severe recession, the likes of which we haven't seen." The government is currently supporting 10 million jobs, with the goal that people will still be employed when the current lockdown ends.

Under the fund, the government will match private money from investors including venture capital groups with loans that convert to equity if they're not repaid.

Applicants must have previously raised at least £250,000 in equity investment in the last five years, and have half or more of their employees based in the UK or generate at least half of their revenue through UK sales.

It will be open until September, and the Treasury has initially committed £250 million.

"The UK is a global tech and creative hub and we are committed to supporting high-growth businesses through this challenging period," Culture Secretary Oliver Dowden said in an emailed statement. "The tech sector has played a crucial role throughout the pandemic and these innovative firms will be key to driving growth through our recovery."

BLOOMBERG