The New Enterprise Allowance (NEA) closed to new applicants in April 2023, but the questions it raised about how government start-up support works for women have not gone away. The scheme was meant to help unemployed people move into self-employment through mentoring and a weekly allowance. Instead, its design revealed how easily official support can exclude women who start businesses part-time, combine caring responsibilities with work, or claim benefits in ways that do not fit a standard form.

If you are unemployed or on a low income and want to start a business in 2026, you need to know what has replaced the NEA and how to avoid the same traps. This article sets out the current start-up support for women in the UK and what the NEA’s failure tells us about the support women still need.

What the New Enterprise Allowance was

The NEA launched in 2011 for people claiming Jobseeker’s Allowance (JSA), and later expanded to include some Employment and Support Allowance claimants and dependent partners in a couple’s claim. It had three stages: a mentor helped develop a business plan while the claimant stayed on benefits; once the plan was approved, the claimant could start trading; and after leaving JSA, they received a weekly allowance of £65 for 13 weeks, then £33 for another 13 weeks.

The scheme closed to new applicants in April 2023, following a Department for Work and Pensions announcement that existing participants could continue until the end of their award. Unemployed people who want to start a business now must use the support that replaced it.

Why the NEA failed women

The scheme was aimed at people moving from unemployment into self-employment, a transition that many women make. Yet female participation stayed low. Parliamentary questions repeatedly highlighted the gap, and ministers struggled to explain it.

The barriers were built into the scheme. To qualify, a business had to be capable of replacing all of a claimant’s benefits within three to six months. Most women start businesses part-time and take longer to become established, often juggling caring responsibilities alongside work. That unrealistic timeline ruled many out.

Information was also hard to find. Official advice told people to “talk to your Jobcentre Plus adviser”, yet many advisers knew little about the NEA and showed little interest in finding out. The clearest guidance often came from independent sources rather than government channels.

Benefit rules excluded others. Some women were advised to claim as a dependent partner on their husband’s claim. That single administrative change left them ineligible until the rules were partly relaxed in 2014.

One woman, Colette, shared her story with Prowess in 2013. After she and her husband were made redundant, she was moved onto her husband’s joint benefit claim as a dependent partner. That change meant she was no longer directly claiming JSA and so was excluded from the NEA, despite having prepared her business for launch.

The original Enterprise Allowance Scheme of the 1980s was more generous: it ran for a full year, paid a £40 weekly allowance on top of other benefits, refunded travel expenses and covered childcare costs. That more flexible design attracted a higher share of women participants than the NEA managed in its early years.

Start-up support for women in 2026

With the NEA closed, these are the main routes for unemployed or low-income women who want to start a business in 2026.

Use a Start Up Loan to launch

The government’s main replacement for the NEA’s financial support is the Start Up Loans programme, delivered by the British Business Bank. It offers government-backed personal loans of up to £25,000 per business partner or director, with a fixed interest rate of 6% per annum and free mentoring for 12 months. Repayment terms run from one to five years, and the loan is unsecured. You can read more in our guide to Start Up Loans for female founders.

Universal Credit start-up period

If you are starting self-employment and claiming Universal Credit, you may qualify for a 12-month start-up period during which the minimum income floor does not apply. This means your Universal Credit is based on your actual earnings rather than an assumed level of income, giving you breathing space while the business becomes established. You will need to show that self-employment is your main work, attend quarterly interviews and provide evidence of progress.

Local Growth Hubs and devolved support

Local Growth Hubs provide free advice, workshops and networking across England. Similar services exist through Scottish Enterprise, Business Wales and Invest Northern Ireland. These hubs can help with business planning, funding applications and local networks, and they are often the first place to ask about grants or free mentoring in your area. Our guide to business grants for women in the UK lists other funding options.

Women-specific networks and mentoring

Organisations such as Prowess, the Women’s Business Council and sector-specific networks offer resources, mentoring and advocacy for female founders. Mentoring matters because the NEA’s own evaluation showed that the quality of advice varied widely; women often did better when they could access independent, experienced guidance.

The current picture for women founders

The gender gap in entrepreneurship has not disappeared. The Alison Rose Review of Female Entrepreneurship 2024 progress report found that women still account for only around one in three UK entrepreneurs, and female-founded businesses continue to receive a small fraction of available equity investment. Women are also less likely to seek external finance and, when they do, tend to receive smaller amounts than men.

These patterns mean that targeted, accessible support remains as important as ever. The closure of the NEA is a chance to press for start-up support for women that is designed around the realities of their lives: part-time start-ups, caring responsibilities, clear information and decent mentoring.

Practical next steps for women founders

• Check whether you qualify for a Start Up Loan through the British Business Bank if you need capital to launch.
• If you claim Universal Credit, ask your work coach about the 12-month start-up period and what evidence you need to provide.
• Contact your Local Growth Hub, Scottish Enterprise, Business Wales or Invest Northern Ireland for free local advice.
• Explore women-specific mentoring through Prowess and other networks before you commit to a funding route.
• Tell your MP or local enterprise partnership if you hit barriers accessing start-up support; policy changes only happen when decision-makers hear what is not working.

For current official guidance, visit GOV.UK’s business finance and support finder or search for “Start Up Loans” on GOV.UK.