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Commercial loan funding for businesses in Shetland

Support provided by Shetland Islands Council

What does this involve?

Secured commercial loans are available to new and growing businesses in Shetland. This loan funding aims to encourage and support the creation, development and growth of businesses that will contribute to and strengthen the local economy in Shetland in terms of jobs and other benefits.

Sometimes equity and hire purchase finance is also available where there are specific advantages to these forms of finance. You should discuss the type of finance you need with Shetland Islands Council before you submit an application.

These loans are usually in the form of gap funding or co-investment with banks and other finance providers. You should investigate and maximise other forms of funding before you apply for a council loan.

Loans are repayable over a fixed term and interest and capital repayments are collected by Direct Debit each month. 

Am I eligible?

Loans are available to new and growing businesses in Shetland. Applicants must have a viable business plan which demonstrates you can pay back the loan.

You'll also be expected to show that the loan will help your business achieve at least one of these objectives:

  • introduce new business activity
  • improve product quality
  • develop new markets
  • improve productivity
  • improve service delivery
  • introduce new or improved manufacturing or production processes
  • substitute for imports

Your business plan should also demonstrate which of the following secondary outcomes may be achieved by your project:

  • create new jobs
  • encourage inward investment from the private sector
  • encourage receipt of external grant funding
  • improve access to employment and economic opportunities in rural areas
  • improve local control of resources
  • improve the local skills base
  • improve local employment conditions
  • increase local wage rates
  • develop infrastructure and/or services in remote and rural areas
  • promote more sustainable use of resources
  • reduce costs and/or improve efficiency
  • result in environmental improvements

What does this cost?

The borrower has to pay Shetland Islands Council's legal fees. There are no arrangement fees or early repayment fees on these loans.

It's also recommended that applicants take independent legal advice, which may incur a separate cost.

Who is this for?

New or existing small or medium-sized businesses (SMEs) in Shetland.

How long does this take?

This will depend on the nature of your loan request and the review process. Shetland Islands Council will evaluate your application and make the lending decision. In general, this is likely to take several months.

Important information

UK Financial Services Regulation places restrictions on lending of £25,000 or less to sole traders and partnerships/limited liability partnerships with 3 or fewer members. Loans to sole traders/small partnerships of £25,000 or less cannot therefore be considered.



Next steps

Visit the Shetland Islands Council website to check your eligibility and submit an online enquiry.

Support provided by Shetland Islands Council