An independent government-backed review has called for a national business skills guarantee for secondary school pupils and a new micro-loan system for asset-poor entrepreneurs, warning that people from disadvantaged backgrounds face significant barriers to starting and growing businesses.
Publishing its final report on Thursday (4 June), the Maple Review said the UK lacks a robust support system for entrepreneurs who have experienced economic hardship, despite entrepreneurship's potential to drive social mobility and economic growth.
Responding to the findings, Blair McDougall, minister for small business and economic transformation, said too many aspiring business owners were being held back.
"Entrepreneurship is a powerful driver of growth and social mobility. This review shows that too many with the talent and ambition to succeed are being held back," McDougall said.
"We now have a shared responsibility to act on these recommendations – as we are doing through our Plan for Small Business – so that starting and growing a business is not a privilege for the few, but an opportunity for all."
Led by Small Business Britain and supported by accounting software provider Xero, the year-long review drew on a national survey of more than 600 entrepreneurs from backgrounds of poverty, as well as focus groups and a nationwide call for evidence.
The report highlights the role entrepreneurship can play in improving economic prospects for the UK's 14.3 million people currently living in poverty, but concludes that existing support systems are failing to meet the needs of those facing financial hardship.
Among its eight recommendations is the creation of a national public-private partnership-backed Business Skills Guarantee, designed to ensure all young people receive access to entrepreneurial education, business skills and role models before leaving school.
The review found that a lack of early exposure to entrepreneurship remains a major barrier, particularly for young people without family business connections or access to local support networks.
A second flagship recommendation is the establishment of a National Micro-Capital System, offering loans of between £100 and £25,000 alongside budgeting, cashflow and forecasting support.
Research conducted for the review found that 63 per cent of founders from disadvantaged backgrounds lacked personal savings to invest in their businesses, while half did not know how to access finance. Nearly half (47 per cent) reported difficulties securing start-up loans or grants, and the same proportion said they lacked confidence in taking on debt.
The report argues that small amounts of flexible capital can be transformative for new businesses but remain difficult to obtain through traditional lending channels.
Michelle Ovens, founder and chief executive of Small Business Britain, said economic hardship remains one of the biggest obstacles to entrepreneurship.
"Economic deprivation at any point in life is the biggest barrier to starting and growing a business, and that is exactly what The Maple Review is looking to address," she said.
"At Small Business Britain, we believe that everyone should have the opportunity to be an entrepreneur, no matter their background or experience, but it is clear from the Review's data that is currently not the case."
She added that the review's recommendations could help tackle poverty while broadening access to entrepreneurship and improving skills across the wider population.
Kate Hayward, UK managing director at Xero, said action was now needed to remove barriers facing aspiring founders.
"Too many people with the drive to start a business are still being held back by barriers they should not have to face alone," she said.
"The Maple Review has shown clearly what needs to change, but the priority now is action."
The review also recommends reforms to self-employment rules, improved financial education and mentoring, and wider access to digital tools to help founders start and scale businesses.
The Maple Review was supported by a steering board comprising representatives from government and industry, including Barclays, BT, Lloyds Banking Group, Xero and The King's Trust.