British Business Bank to develop a £100 million aerospace supply chain fund with the UK Government
The British Business Bank has announced that it has made a firm proposal to the UK Government to set up a £100m aerospace supply chain fund to support UK suppliers and strengthen manufacturing capability across the sector.
The announcement came during the Farnborough International Airshow 2026, where over 600 financial institutions are gathered to explore investment opportunities in the worldwide aerospace industry.
Supporting UK aerospace companies with the capital they need
According to the British Business Bank, the proposed fund will help strengthen the aerospace supply chain, giving high-potential UK suppliers the capital they need to scale, invest and compete. The fund has been specifically designed to bring together public and private sector investment to support this strategically important sector of the UK economy.
Alongside the UK Government, key UK aerospace companies, including Airbus, GKN Aerospace, Rolls-Royce and the trade body ADS, have all been working towards developing and supporting the proposed £100m aerospace supply chain fund that would support UK suppliers and strengthen manufacturing capability across the sector.
The British Business Bank added that the proposed fund would help strengthen the aerospace supply chain by giving high-potential UK suppliers the capital they need to scale, invest and compete while preparing for future aircraft programmes.
“By improving access to structured capital, the debt fund will help strengthen the UK aerospace supply chain, support increased output and position UK firms to compete for future opportunities,” the Bank added.
The Government and the British Business Bank are continuing to work with the aerospace industry to develop the fund structure, high-level investment criteria and delivery route. Further details on this are expected in the coming months once the proposition is sufficiently developed.
The proposal also supports the Government’s Industrial Strategy and the Aerospace Growth Partnership’s ambition to strengthen the UK aerospace supply chain.
By backing this fast-growing priority sector, the Bank said it was making its capital available to help innovative UK companies secure the scale-up capital they need to grow, expand and win future work.
Speaking about the proposed £100 aerospace supply chain fund, Louis Taylor, CEO of British Business Bank, said, “The continued success of the UK’s aerospace sector depends on the capacity, resilience and competitiveness of the supply chain that sits behind it.
“This fund will help strengthen the aerospace supply chain by giving high-potential UK suppliers the capital they need to scale, invest and compete for future aircraft work.”
“By bringing together public and private sector investment, we can support a strategically important sector, back high-value manufacturing jobs and help more UK businesses play a larger role in global aerospace supply chains.”
How the UK Government is supporting the growth of UK aerospace
In recent years, the UK government has taken a proactive role in supporting the aerospace sector through long-term investment, innovation funding and industrial partnerships.
A major initiative has been the continued backing of the Aerospace Technology Institute (ATI) Programme, which funds research and development into advanced aircraft technologies, including sustainable aviation, hydrogen propulsion and more efficient aircraft designs.
In 2024, the government committed £975 million over five years to extend the programme, providing greater certainty for businesses to invest in innovation and create highly skilled jobs across the UK.
The government has also strengthened collaboration with industry through the Aerospace Growth Partnership, bringing together manufacturers, suppliers, universities and government to improve the UK’s global competitiveness.
This partnership supports investment in next-generation technologies while encouraging private sector funding and developing skilled workforces.
Alongside research funding, the government has prioritised green aviation by co-investing more than £250 million in projects led by companies such as Rolls-Royce and Airbus to accelerate low-carbon aircraft technologies.
These initiatives align with the UK’s net zero targets while helping maintain the country’s position as one of the world’s leading aerospace manufacturers.
Together, these policies, along with the £100m aerospace supply chain fund announced at Farnborough, aim to drive economic growth, strengthen exports, support thousands of high-value jobs and ensure the UK remains at the forefront of global aerospace innovation.
