Businesses across the UK will be given loans of £100,000 by the University of Huddersfield - the first university to offer business loans - through a new partnership with peer-to-peer lender Funding Circle.
The arrangement - which is the brainchild of vice-chancellor Professor Bob Cryan - is good for new students too as the interest earned on the loans will be used to fund scholarships for the University's Enterprise Development degree.
The University of Huddersfield believes the scheme could pay for more than 200 talented students from socially deprived backgrounds to take the degree over the next five years.
Funding Circle and the university will also develop a programme of seminars and internship opportunities with borrowers to ensure the next generation of business leaders gain hands-on experience with fast-growing British businesses as part of their degrees.
The university already offers a number of courses, seminars and equipment facilities for businesses to use, as well as arranging work experience placements and job interviews with its students.
The scheme has got the backing of Dragon's Den star Theo Paphitis - he said he'd seen the deep commitment the university had to supporting businesses and delivering the next generation of business leaders first hand.
"With this initiative the university has made a pioneering step in taking its commitment to businesses even further. It is an exemplar for other universities to follow," he added.
Samir Desai, chief executive and co-founder of Funding Circle, added: "In today's economy, businesses want access to finance quickly with minimal disruption. This partnership will ensure businesses get both the finance they need to grow and access to world class research and development facilities through Huddersfield University.
"At the same time, it will provide much-needed work experience with companies that are the lifeblood the UK economy. There are over one hundred universities in the UK – if the University of Huddersfield's investment can help to support 200 students over five years, imagine the possibilities."
In December 2012, the government announced plans to lend £20 million to small businesses through Funding Circle. The peer-to-peer marketplace announced last November it had partnered with Lancashire County Council, which became the first local authority to start lending local businesses.
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