New Enterprise Allowance scheme - My story

Electrum wrote: »

How much do you get per week please on new enterprise allowance?

Can you still get that £1000 grant to start up? Or is it a loan?

The grant is £65 per week for 13 weeks, followed by £33 per week for the following 13 weeks. This does not have to be paid back.

There is a facility to apply for a loan of up to £2500, subject to status/credit checks. This has to be paid back and the term can be up to 5 years. However, the interest rate is a stonking 6% (6.02%APR). :eek:

Not sure the NEA loan is credit checked in the same way as a normal bank loan. The main factor is the completed business plan and signing of JSA.

The NEA loan is a maximum of £2,500 and is linked to having a viable business plan. Its aimed at new, start-up businesses who have not started trading yet. A clear credit check is not a condition of offering the NEA loan. However, they will ask questions before offering the loan. If they smell a scam. They are within there rights to say no to offering a loan. However, if your unemployed for any time. Every chance that many will have a low credit rating. Without a loan. Many would not have the funds to start a new business. So, the NEA loan providers are expected to look at credit checks in a less negative way than other types of loans.

The loan is/was paid back over upto 3 years. This might hae changed but not as fare as im aware. Interest only payments in 1st year of trading of £13 per month. The 2nd and 3rd year of loan repayments are £110.82 per month. Thats for a £2,500 NEA loan paid back over the full 3 years

Start-Up Loan Company also offer loans to new businesses. They have a longer upto 5 year pay back time. However, some big differences between the amount your able to borrow and the terms to be offered by the Start-Up Loan Company. You will be credit checked and viewed in a similar way to those who request a normal bank loan!

Start-Up Loan Company loans can be £10,000+. Start-Up Loan Company loans are more than £5,000 on average. Key point with a Start-Up Loan Company loan is that you must already be trading so you can show that the business is viable and making a profit.

Those on NEA can switch to a Start-Up Loan Company loan once they can prove that they are making a profit from their business and want further funding to grow. If you have a NEA loan. You have to clear the original NEA loan in full with part of the new Start-Up Loan Company loan.

Here is where there might be some confussion. It confussed me at the time of attempting to get the NEA loan two years ago. If you ask the Start-Up Loan Company if they offer/provide NEA loans. They say yes!!! However, these loans are in fact, top up loans for those who have been with NEA. Bit of a con but they are only a bank with Government backing who are looking to make 6% interest on a £5,000+ loan.

Sounds positive Val. Yes, your on the NEA business plan part of the programme as you now have a mentor. Any issues with JCP. Set your mentor on them! So, no job search target rubbish for you. Your working towards completing your business plan. Thats your job search!

The weekly grant payments are yours once your business plan is signed off by your NEA adviser/mentor as being complete and viable and you have signed off JSA.

JCP staff should be helpful now that your on NEA. Any issues with JCP. Set your NEA adviser/mentor on to them. They should know how to deal with any difficult JCP staff.

YKay wrote: »

Does anyone know if a couple would be eligible to both join NEA together? We are both unemployed claiming JSA and would be interested in starting a business together.

Anyone ?

YKay, have you been refered to The Work Programme?

You will have to take part in the Work Programme if you belong to any of the following groups of people:

• you are aged 18-24 and have claimed jobseeker's allowance for nine months
• you are aged 25 or over and have claimed jobseeker's allowance for 12 months.

If you have been refered to The Work Programme. Your stuck on that programme for 2 years and cannot be refered to NEA in that time period. The reason being that the Government are already providing support to get you back into long term full-time work.


I was unemployed for almost 4 years in total. I was refered to The Work Programme when it first started. It was a total waste of 2 years of my life. I was then placed on what was called Next Step. Within 2 weeks I was refered to NEA and my working life changed for the better. So, clearly there is no time limit for being unemployed before going on NEA as long as you have not been refered to The Work Programme or a similar programme of support.

Ask what level of support you are getting from JCP to help you back into work and have you been refered to any time locked type of support or programmes? If not, then you should be able to be refered to NEA as long as you have a viable business idea.

Being unemployed for too long is not a valid reason to not refer you to NEA if you have a viable business idea. Request to be refered to NEA again ASAP. If your told no again by your JCP adviser. Ask to speak to a manager and explain your business idea (Get something down on paper if you can) to them and ask the manager to refer you to NEA.

Personally, if I had not been told in writing that I had been refered to a programme of support such as The Work Programme. I would be asking to see either my JCP adviser or a JCP Manager on Monday morning about your business idea and requesting to be refered to NEA, ASAP. As you have not had anything in writing about being refered to a different programme of support. It sort of puts the problem back in there hands re any issues regarding the amount of time you have been unemployed. Get yourself refered to NEA before they refer you to The Work Programme. If there is nothng in writing. Then, they have the problem over time!