The UK Government unveils £7 million funding for AI to help small businesses

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The UK government has unveiled a new plan to establish the UK as a global tech leader.

On January 14th, 2025, Prime Minister Keir Starmer unveiled a £7 million fund to boost small businesses’ productivity and efficiency through Artificial Intelligence (AI). According to GOV.UK, the fund is set to be distributed across 120 projects to enable the testing of AI technology, and help smaller businesses tackle pressing challenges.

The funding comes from the UK Research and Innovation Technology Missions Fund, which has the aim to enable new and existing capabilities and capacity in AI. Sir Keir Starmer shared his commitment to using this funding towards developing AI to transform the lives of working people for the better.

DIGIT revealed how AI forecasting tools from Oxford Cognitive Labs are among the projects receiving funding. This is set to have the potential to cut food waste and protect profit margins at a bakery in London by having the ability to predict their daily sales ahead of time, and therefore the correct amount of resources can be distributed daily.

Along with support for the food sector, the construction industry is set to be a beneficiary of AI. Models that can anticipate where mould may be likely to grow in buildings are a share of the tools receiving funding, which would be beneficial for remediating any problems before they could become a health and safety issue.

The IMF estimate that the utilisation of AI made possible by the new funding could see a 1.5% increase in UK productivity annually. Accelerating the productivity of the UK workforce naturally foresees a stronger UK economy, emphasised by the Director of AI & Data Economy at UKRI-Innovate UK, Esra Kasapoglu, who shared:

“The adoption of AI in UK industry is fundamental to supporting the country’s economic growth.  Today’s investment will enable us … to help more companies to unlock the potential of AI in their business”

The projects supported by the newly unveiled fund will contribute to the creation of several AI Growth Zones where new AI technology will be focused, as outlined in the AI Opportunities Action Plan. Announced on Monday 13th January 2025, Business Insider shared how this Action Plan confirmed the government would pursue all 50 recommendations made by tech entrepreneur Matt Clifford to boost the AI sector in the UK.

 

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