Under proposals revealed today by the Institute for Public Policy Research (IPPR), applicants would invest £5 million over the lifetime of the visa made up of £3m upfront, £1m after two-and-a-half years, and £1m after five years.

Unlike the UK’s previous investor visas – which often directed funds into low-risk assets with limited economic impact – the new proposal would channel the money through an investment vehicle overseen by the British Business Bank (BBB) with the focus on priority sectors. 

Hailed by the IPPR as a “new model for investment migration in the UK”, the scheme would support 4,000 additional jobs and the bank, whose CEO Louis Taylor is set to step down later this year, will help those sectors access the finance needed to grow.

The proposal comes as the UK continues to face persistently low levels of business investment, particularly affecting smaller firms and high-growth companies that need capital to expand, create jobs and develop new technologies.
 
The IPPR stressed that the visa would not provide a fast-track route to citizenship or settlement, with applicants required to meet the same residency requirements as other migrants.

To address concerns about past schemes, the report sets out a tightly controlled model with strong safeguards, including:

•    A specialist Home Office unit to carry out financial and security checks
•    Robust verification of the source of funds
•    Restrictions on high-risk jurisdictions, including a ban on applications from Russia
•    A strict cap of 100-150 main applicants per year
•    Independent reviews of the scheme’s impact and risks

Marley Morris, associate director for migration, trade and communities at IPPR and co-author of the report, said: “A new British business investment visa would aim to channel funds from overseas applicants into innovative businesses looking to scale up, in order to support economic growth and jobs across the UK.

“Our proposal would address the weaknesses of the UK’s former investor visa by ensuring investments are deployed in innovative and strategically important sectors, while putting in place robust safeguards to prevent abuse.”

Aditi Sriram, economist at IPPR and co-author of the report, added: “The UK has no shortage of ambitious businesses with the potential to grow – the challenge is getting capital to them. A well-designed investment visa could help unlock hundreds of millions of pounds in new funding, supporting jobs, growth and economic activity across the country.”