How can I secure funding or loans to start my private practice?

First, how much do you really need?

Before looking for money, list every start-up cost and the running costs until the practice pays for itself. See start-up costs for the full list.

Then look for ways to shrink the number:

• Rent rather than build. Consulting rooms in an existing registered clinic, or practising privileges, avoid a fit-out.
• Keep other income while you grow. Many GPs start with a few private sessions alongside NHS or sessional work. See working privately and in the NHS.
• Lease or hire expensive equipment rather than buying it.
• Choose monthly software and services without large set-up fees.

Add a buffer for slower-than-expected bookings. Working capital, the cash to cover costs before income builds, is the part most often underestimated.

Sources of funding

Your own savings

The simplest route, with no interest or guarantees. Decide in advance how much you are prepared to lose, and keep it separate from your personal money in a business account.

Bank loans and overdrafts

High-street and specialist lenders offer business loans and overdrafts to professionals. For a new business, expect to provide a business plan, a cash-flow forecast, your personal finances, and often a personal guarantee if you borrow through a company. A guarantee means you can be pursued personally if the company cannot repay, which removes much of the protection of limited liability for that debt.

Not all business lending is regulated by the Financial Conduct Authority, so you may have fewer protections than with personal borrowing. Read the terms and take advice before signing.

Start Up Loans

The British Business Bank’s Start Up Loans scheme is a government-backed personal loan for starting or growing a UK business. At the time of review:

• each owner or partner can apply for up to £25,000, with a maximum of £100,000 per business
• the interest rate is fixed at 7.5% a year, repayable over 1 to 5 years
• you must be 18 or over, live in the UK, and be starting a UK business or have been fully trading for less than five years
• you need a business plan, a cash-flow forecast and a personal survival budget
• successful applicants are offered up to 12 months of free mentoring, and there is no application fee or early repayment penalty

Because it is a personal loan, you repay it whether or not the practice succeeds. Check the current terms before applying.

Equipment leasing and asset finance

Leasing, hire purchase and rental spread the cost of equipment such as couches, ECG machines, spirometers or a fridge for vaccines. Leases sometimes include servicing and calibration. Compare the total cost over the term with buying outright, and check what happens at the end.

Partners and investors

Another GP or an investor can put money in for a share of the business. That brings shared control and a need for a clear shareholders’ or partnership agreement. If an investor becomes a director of your company, the CQC requires every director to be a fit and proper person under Regulation 5 of the Regulated Activities Regulations 2014.

Grants

Grants for private healthcare start-ups are rare. Local business support services sometimes run small schemes or advice programmes, so ask, but don’t build your plan around a grant.

What lenders want to see

• A realistic business plan: services, prices, target patients, competitors and how you will find patients. See creating a business plan.
• A month-by-month cash-flow forecast for at least the first year, with cautious booking assumptions.
• Evidence of your own commitment, such as savings you are putting in.
• Your experience and credentials, and how you will keep income coming in while you build.
• Your regulatory plan, including CQC registration timing, because you cannot see patients until it is granted.

The CQC financial viability statement

In England, Regulation 13 of the CQC (Registration) Regulations 2009 requires providers to take all reasonable steps to keep the regulated activity financially viable. For new applications, the CQC asks most providers for a financial viability statement. It must be signed by a professionally qualified accountancy firm, or by a bank or financial services firm regulated by the FCA, not by a friend or relative. The signer must say whether, in their opinion, you are financially viable, and they may ask to see your business plan.

So line up an accountant early. They can sign the statement, advise on structure and help with the forecasts your lender wants. See whether to set up a company.

In Scotland, Wales and Northern Ireland, registration is with HIS, HIW or RQIA. Check what financial information each asks for.