Economic Resilience Fund (ERF) Phase 2 - Q&As

The ERF is designed to support businesses, social enterprises and charities that are not eligible for other Welsh Government Covid-19 non-repayable grant support schemes. This round of funding is targeted at microbusinesses, SMEs and large businesses in urgent need of support and which are yet to receive financial assistance from the ERF.

The ERF eligibility checker reopened on Tuesday 9th June to allow businesses time to prepare their applications, ahead of the fund reopening for applications at the end of June. The eligibility checker can be found at: https://fundchecker.businesswales.gov.wales

Phase 2 of the ERF will operate in the same way as phase 1 but with an update to the eligibility of the micro scheme. Limited companies which are not VAT registered will now be able to access the ERF, subject to other criteria being met. A wider range of large businesses, which have suffered more than a 60% reduction of turnover since 1 March 2020, may also qualify for funding if they meet conditions set. 

Businesses can only receive support from the ERF on one occasion. We have finite resource and need to target businesses that have yet to receive financial assistance from the ERF.

If micro businesses have access to the non-domestic rates grant funding they will not be able to apply to the ERF.

If businesses have been rejected for ERF and circumstance has changed then you can re-apply if you meet the eligibility criteria. 

Partnerships are not excluded from the ERF if they meet the eligibility criteria. 

In addition, partnerships may be able to access UK Government support as follows:

  • Individuals that form a partnership can access the Self Employed Income Support Scheme if the trading profit received during the financial year is less than £50k and they don’t pay themselves dividends.
  • If a partnership employs via PAYE it will be able to access the Job Retention Scheme.

Micro businesses will be eligible for up to £10k support from phase 2 of the fund where:

  • Efforts to sustain business activities are demonstrated;
  • No funding support was agreed under phase 1 of the ERF;
  • Confirmation is provided that funding from any other Welsh Government Covid-19 related non-repayable grant funding source is not being pursued;
  • In excess of a 40% reduction in turnover since 1 March 2020 has been experienced;
  • A sole trader is VAT registered (or sector exempt from VAT) and PAYE registered employing between 1 and 9 employees (in addition to the business owner);
  • A limited company satisfies two of the following conditions:
    • VAT registered or sector exempt from VAT
    • PAYE registered, which can include the Director/Owner if they are an employee of the company denoted by PAYE structure (not dividend)
    • Annual turnover exceeds £50k;
  • Not eligible for non-domestic business rate grant; and
  • Operating address and employer in Wales.

SMEs will be eligible for up to £100k support from phase 2 of the fund where:
Confirmation is provided that funding from any other Welsh Government Covid-19 related non-repayable grant funding source is not being pursued;

  • In excess of a 60% reduction in turnover since 1 March 2020 has been experienced;
  • Not eligible for business rate relief, or if is, the amount would be deducted from any allocation from this fund;
  • Did not receive phase 1 ERF support;
  • Operating address and employer Wales;
  • A sustainable business plan exists to trade beyond the Covid-19 pandemic;
  • Has explored other forms of funding before applying to the ERF; and
  • An undertaking is provided that for as long as the Coronavirus Job Retention Scheme is in place, no future compulsory redundancies will be made.

Large businesses will be eligible for up to £690k in compliance with temporary State Aid rules where:

  • In excess of a 60% reduction in turnover since 1 March 2020 has been experienced, or a 60% reduction in turnover is forecasted between the time of application and the end of the project being supported;
  • Not eligible for business rate relief, or if is, then the amount will be deducted from any allocation from this fund;
  • Operating address and employing at least 40 people in Wales;
  • A sustainable business plan exists to trade beyond the Covid-19 pandemic;
  • Has explored other forms of funding before applying to the ERF;
  • An undertaking that for as long as the Coronavirus Job Retention Scheme is in place no future compulsory redundancies will be made; and
  • Agreement to match fund support.

The Welsh Government recognises that not all businesses will benefit from the ERF. The package has been designed to be affordable within the available funding, and we had to take difficult decisions on the eligibility criteria. We would encourage you to explore:

We are working with partners to develop further support options for those businesses that have not yet been able to access support.

The measures we have taken are in addition to those provided by the UK Government, making the support package in Wales the most comprehensive and generous in the UK. This next phase will reach businesses that have yet to receive funding, but we know it won’t reach all. We are proactively working on further options, but it is clear that we need the UK Government to step up and provide the additional funding needed to see Welsh business through this pandemic.

Please reassess and keep looking at our website to keep up to date on current and emerging support from UK and Welsh governments. https://businesswales.gov.wales/coronavirus-advice/

There are alternative options that you may wish to consider such as UK Government level funding including the Bounce Back Loans, Self-Employment Income Support Scheme, Job Retention Scheme and the Business Interruption Loan Scheme.

In addition, Business Wales has a wide range of non-financial advisory support available. Any business affected is encouraged to visit the Business Wales website https://businesswales.gov.wales or contact the Business Wales helpline on 03000 6 03000. The Development Bank of Wales also has loan and equity funding available for Welsh businesses.

We are currently in the ‘response’ phase but are considering how we support businesses to move forward to the ‘re-set’ and ‘re-start’ phases and finally into the ‘recovery’ phase. As yet no decisions have been made on how to utilise any potential future funding.

We are finalising the details of an impact assessment that will be undertaken on the Economic Resilience Fund in response to the Covid-19 outbreak which will explore how we support businesses in the future.


Start-Up Grant FAQs

The Welsh Government recognises that there is a need to support those who are self-employed but fall outside of the UK Government’s Self Employment Income Support Scheme (SEISS) because they only started trading in 2019. 

The Start-Up Grant aims to provide a lifeline to those who established their business after the 31 March 2019, and help them to continue trading through the Covid-19 outbreak.

The purpose of the grant is to support newly created businesses with immediate cash flow support to help them survive the economic consequences of the Covid-19 outbreak. The grant seeks to complement other Covid-19 response measures to support businesses, social enterprises and charitable organisations in Wales.

The total pot for the Start-up Grant is £5 million, and will provide eligible businesses with a grant of £2,500 each.

The Start-Up Grant will support up to 2,000 businesses in Wales.

The Start-Up Grant opened to applications on the 29th June 2020.

The Start-Up Grant will close when the fund is fully committed. 

The eligibility criteria for the Start-Up Grant is:

  • Businesses must be operating in Wales
  • Started trading between 1st April 2019 and 1st March 2020
  • Forecast annual turnover less than £50,000
  • Not in receipt of the Self Employment Income Support Scheme, Economic Resilience Fund or the Business Rate Grant
  • Businesses must have one or more of the following:
    • HMRC Unique Taxpayer Reference (UTR) Number
    • VAT Registration Number or a VAT exemption certificate
    • Written correspondence confirming registration with HMRC
  • Have experienced a drop in turnover greater than 50% as a result of the Covid-19 outbreak between April and June 2020
  • Supported businesses must aim to maintain employment for 12 months

The Start-Up Grant is being administered by local authorities.

The Start-Up Grant is accessed through the Economic Resilience Fund eligibility checker on the Business Wales website https://fundchecker.businesswales.gov.wales/

You will need to visit the Economic Resilience Fund Eligibility Checker on the Business Wales website https://fundchecker.businesswales.gov.wales/

If eligible you will be directed to your local authority website where you will be able to access the online application form, or the application form can be downloaded and emailed to your local authority together with the required evidence documents.

You will need to submit a short application form and self-declaration that is supported by evidence. 

Scanned documents and photos are acceptable forms of evidence.

You will need to provide:

  • Proof of identification (one of the following)
    1. Current UK or EEA photocard driving licence
    2. Current signed passport
    3. Original Birth certificate
  • Proof of business address (one of the following)
    1. Council tax statement
    2. Utility bill
    3. Written correspondence confirming registration with HMRC
  • Evidence of active trading up to 17th March 2020
    1. Business bank statement to be provided

We will acknowledge receipt of your application within 10 working days. 

We aim to process grant applications within 30 days of receipt.  

There are 2,000 grants available and applications will be dealt with on a first come first served basis. This may mean that you submit an application but it is not approved because the fund is fully committed before your application is considered. 

Decisions on applications will be made based on the information provided in your application form, associated evidence and information checks that are conducted from other business data sources. If any data in incomplete or incorrect or the evidence provided is insufficient we will not process your application and it will be rejected.

If your application is approved you will receive a grant offer letter by email notifying you of the award of the grant. 

You must accept the offer letter by e-mail before payment can be made. 

If you are successful you must register for support with the Business Wales service once the grant is awarded.

Grant offers will be open for 14 days. If you do not accept the grant offer within this period the offer will be withdrawn.

You will receive £2,500. The grant will be paid on the basis that 100% of the grant is paid up front.

If your application is unsuccessful, you will receive an email outlining the reason for rejection.

There is no appeal process. 

Only one application is allowed per business.

Second home owners with short or long term tenancy agreements are not eligible for this grant.