Choose the right finance when starting a business

Finance options for new businesses


The type of financing you choose will depend on your business type, the amount of money you need, and how you plan to use it. These factors are essential in selecting the best financing option for your business. 

Take into account the following finance options for new businesses.

Personal savings and borrowings

Using your own savings or personal borrowings can be helpful. This is especially true if you can't get external finance. See advantages and disadvantages of using your own money to start a business.

Family or friends financing

Borrowing money from family or friends should be approached carefully. You should consider the risk that they could lose their money if your business doesn’t succeed. See financing from friends and family.

Bank financing

Borrowing from a bank is possible if you have a credible business plan and can offer some security. Many businesses use overdrafts for daily cash flow. They use loans for long-term funding or large purchases, such as equipment. See bank finance.

Investor funding

Selling shares to business angels or venture capitalists can attract outside investors. They provide short-term finance without the need for repayment. It can also bring in expertise along with funding. However, it usually means giving up shares in your business. Investors may want control over its management. See shares and shareholders and equity finance.

Grants and government support

You can get a grant or government support, like Enterprise NI's Start Up Loans scheme. These can offer cheap financing and often come with business advice or subsidised consultancy. However, there is usually a lot of competition for grant schemes, and you will need to meet various criteria, depending on the scheme. See grants and government support.

Commercial lenders

Consider options from insurance companies or building societies. They often offer good terms and have less strict conditions than traditional banks. You may get a better deal - eg lower interest rates - and they are generally less restrictive.


Raising funds through crowdfunding platforms means getting money by asking many people for a small investment in your business. See crowdfunding. See crowdfunding.

Other sources of business finance

You can seek finance from other areas, like a community development finance institution. This can work if your business only needs a little funding. Or, if you are setting up in a deprived area or a sector not covered by banks or other lenders. See other sources of business finance.

Most businesses use a mixture of finance sources. For example, you might invest your own money to cover market research. You would borrow from the bank to buy equipment and machinery. 

For further information see business financing options - an overview.

Business support finder

The Northern Ireland business support finder is a searchable database that can help you find publicly-funded and not-for-profit sources of business assistance you may be eligible to apply for. Support may be available in a number of forms, including financial assistance and free or subsidised advice services.

See financing your business: the options to watch a video that outlines business finance options that may be available to you.