R&D funding

R&D Loan Scheme - Apply Now

open this image in new window: R&D Loan Scheme - Apply Now

Is your business finding it challenging to continue your R&D activities due to COVID-19?

Businesses with R&D funding impacted by COVID-19 may be able to apply for an R&D loan of up to $400,000 under Callaghan Innovation’s R&D Loan Scheme.

High-value R&D activity is critical for a faster economic recovery. It creates new and innovative export opportunities, while lifting New Zealand’s productivity. 

However, due to COVID-19 economic impacts, R&D programmes are particularly at risk of being cut or put on hold as businesses focus on urgent and short term needs. It is especially an uncertain time for R&D intensive startups relying on external investment.

In response, the Government has dedicated $150m for an R&D Loan Scheme. The scheme is intended to encourage R&D-performing businesses to continue R&D programmes in the current economic environment. 

The application process is completed in two stages. Stage 1 requires initial details and an estimate of the amount you plan to borrow and Stage 2 requires detailed information about your R&D plans.

Callaghan Innovation does not provide financial advice - please see your financial advisor for advice.

Loan details at a glance

Under the R&D Loan scheme:

  • Businesses will be able to apply for a loan of up to $400,000 to support planned R&D activity, subject to other forms of government R&D support.
  • The loans will be charged interest at 3% from the start of the loan, however interest will be waived if the loan is repaid in full within the first year.
  • Repayment instalments are not compulsory for the first three years, however businesses may repay sooner if they wish. The maximum loan period is 10 years.
  • Loan payouts will follow Callaghan Innovation’s standard fortnightly payment schedule, and will depend on demand and your complete filing of the appropriate documentation.

Useful documents

PDF icon R&D Loan Scheme terms and conditions – This document is purely for reference purposes

File R&D Loan Scheme Application Guidelines and Template

Eligibility criteria 

The purpose of the R&D Loan Scheme is to help businesses continue their R&D programmes in the face of COVID-19 impacts. 

All New Zealand businesses undertaking eligible R&D can apply for this loan, including if they already have a Project Grant, Growth Grant or the R&D Tax incentive. The total amount businesses can borrow takes into account this additional government support.

To be eligible for the R&D Loan Scheme, businesses must:

  • Be a legal New Zealand entity
  • Have been in a financially solvent position as at 31 December 2019
  • Be able to show that their ability to fund their R&D activity is impacted by COVID-19. This includes showing they have experienced a 30% or greater drop in expected sources of funding to support eligible R&D activities over the year ending 30 June 2021.
  • Have had an eligible R&D programme or plan in place before 26 March 2020 and plan to spend at least $50,000 on eligible R&D.

For more information see the FAQs below.

How much can my business borrow?

A business’s maximum loan entitlement under the scheme is equal to the lower of:

  • The business’s Projected Eligible R&D Expenditure minus Other Forms of Government R&D Funding; OR
  • $400,000.

The business’s Projected Eligible R&D Expenditure is what it plans to spend on eligible R&D over the year ending 30 June 2021.

In addition: 

For purposes of calculating Other Forms of Government R&D Funding, it is assumed that all businesses that are eligible for the loan are entitled to receive (at a minimum) support covering 15 percent of their R&D expenditure through the RDTI (Research and Development Tax Incentive). This means that the maximum loan entitlement for any business will be 85 percent of its Projected Eligible Research and Development Expenditure up to a maximum of $400,000.

Other Forms of Government R&D Funding include any funding that is intended to subsidise the cost of activities included in the business’s Eligible Research and Development Activity. Examples are R&D Project Grants and R&D Growth Grants. There are examples in the Stage 1 form above.

Estimating your loan amount

In order to estimate how much you may be able to borrow we have prepared a Loan Estimator Tool. You will need to know your expected eligible R&D spend over the July 1st 2020 to June 30th 2021 period, as well as how much of this is expected to be covered by other forms of government funding. If you don’t currently have any other forms of funding support in place the tool will also suggest your potential RDTI claim amount (note this may vary depending on your specific circumstances). The tool is downloaded or opened as a spreadsheet. 


Application process

The application process is undertaken in two stages. You must complete both Stage 1 and Stage 2 before we can progress your application.

Please read the details on this webpage, in the FAQs and key documents carefully and make sure you have the required information ready before formally submitting your information.

See the guidance on eligible R&D for further clarification on eligibility and eligible R&D.

Stage 1 

Stage 1 includes providing initial details, which will also require you to estimate the amount you expect to borrow under the scheme via the Loan Estimator Tool above. There is guidance in the Stage 1 form.

You must complete this Stage 1 form ahead of Stage 2.


Stage 2

Stage 2 of the R&D Loans application process involves a formal application and document submission via our online portal (IMS). 

It is essential that you complete the Stage 1 form before you proceed to the Stage 2 application. Once you have completed Stage 1 we will set you up with access to the IMS portal within two working days (if you don't already have access) and you should receive an email with login details.

If you haven't heard from us within two working days of submitting your Stage 1 form (please check your junk folders), please email us at RDLoans@callaghaninnovation.govt.nz.

Application form, guidance and checklist

We recommend you read the Stage 2 Application guidance, which includes a checklist and a word copy of the application, so you know what information and documentation you need to have on hand before completing your formal application.



Starting your Stage 2 application

Your formal Stage 2 application and documents must be submitted in full in our online IMS portal.

To begin your Stage 2 application, proceed to the IMS platform, login and start your application. If you are having difficulties with forgotten IMS passwords or login details, please email rdloans@callaghaninnovation.govt.nz

We cannot begin to assess your application until it is fully complete with all documentation uploaded and submitted within the online portal (IMS). Please note, this is a limited fund. 

We may contact you if further information is required.

If you need help with this application, please contact your Callaghan Innovation relationship manager or email rdloans@callaghaninnovation.govt.nz

For more information see the FAQs below.



How is this R&D Loan Scheme relevant to the COVID-19 response?
The R&D Loan Scheme is part of the COVID Response and Recovery Fund. R&D is a key to a faster economic recovery, creating high-value jobs and growing the economy. However, during tough economic times, R&D can often be diverted or cancelled in favour of other spending. 

Why will R&D loans help businesses responding to COVID-19?
The loans provide an immediate source of finance for businesses conducting eligible R&D activity to enable them to maintain existing programmes and secure the jobs they create. For many startups this is an essential component of their business.

How is this different from other COVID-19 and loan support?
R&D activities are high value-add activities, not classified as business as usual. They involve complex science, technology and engineering expertise and are generally seen as riskier investments. However, they have greater payback for the economy, transforming current industries into higher-value sectors with high-skill jobs.

What checks and balances are in place to make sure the loans are taken up in the correct way?
There are measures in place to ensure the scheme is used for the intended purposes. As well as and audit programme and statutory declarations, businesses will need to report back on their eligible R&D expenditure.

Loan details

How much can businesses borrow under the R&D Loan Scheme?
Businesses can apply for up to $400,000 depending on their eligible R&D spend and other current R&D support calculations, to help fund their eligible R&D expenditure. See the Loan estimator tool above. 

When will businesses start to receive this loan payment?
Loan payouts will follow Callaghan Innovation’s standard fortnightly payment schedule, and will depend on demand and your complete filing of the appropriate documentation. 

What are the interest and repayment terms?
The loans will be charged at 3% interest from the start of the loan, but the interest will be waived if the loan is repaid in full within the first year. To ensure businesses can manage repayments, instalments are not compulsory for the first three years and businesses have up to 10 years to repay the loan completely. Businesses may make repayments or repay in full sooner than this if they wish. Please see the terms and conditions.

What are the loan contract details?
Please see the R&D Loan terms and conditions

When do businesses need to spend the loan funds?
Businesses can spend the funds on eligible R&D between 1 July 2020 to 30 June 2021. 

What about eligible R&D spending after 1 July 2020, but before we receive the loan funds?
You must retain all records from 1 July 2020 concerning your expenditure on eligible R&D activities related to the R&D Loan funding. 

What happens if the funds are not spent within the year?
Businesses are expected to use the funds by 30 June 2020. If funds have not been spent by 30 June 2021, businesses must repay those funds immediately unless otherwise agreed by Callaghan Innovation. Please see the terms and conditions.

Is the 3% interest payable on the principal amount or the remaining balance?
Please see the terms and conditions.

Are there penalties if the loan is spent on non-eligible activities? 
The loan funds must be spent on eligible R&D activities. There are penalties for misspending. See the terms and conditions.

What information needs to be retained for reporting and audit purposes?
You must retain all records concerning your expenditure on eligible R&D activities using the loan funding. This includes pay slips, time sheets, invoices, purchase orders, lease details and any other records that show how you spent the funds.


Can my businesses apply for an R&D Loan if it is already receiving a Project Grant, Growth Grant or the R&D Tax Incentive (RDTI)?
Yes, it can. The government will support up to 85% of total eligible R&D spend. This means the amount you can borrow takes into account other forms of government support – such as R&D Project Grants, R&D Growth Grants or the R&D Tax Incentive.

What is a legal NZ entity?

  • A Company registered under the Companies Act 1993; or
  • A Limited Partnership registered under the Limited Partnerships Act 2008; or
  • A Māori incorporation or a trust established under Te Ture Whenua Māori Act 1993, a trust established on behalf of Māori claimants to receive and manage assets as part of the settlement of a claim under the Treaty of Waitangi, a Māori statutory body, or a business that is controlled by one or more of these types of Māori entities.

The loans are not available to Government entities such as CRIs, SOEs, Councils, or an entity that is 50 per cent or more owned by one of these types of entities. These exclusions are outlined in the Stage 1 form above

Are pre-revenue businesses eligible?
Pre-revenue businesses are eligible provided they meet the criteria. This includes being able to show that their ability to fund their eligible R&D activity is impacted by COVID-19. They can do this by showing they have experienced a 30% or greater drop in expected sources of funding to support eligible R&D activities over the year ending 30 June 2021. 

What is eligible R&D?
Please see our detailed R&D Loan Scheme Guidelines for more information on eligible R&D.

Research and Development (R&D) under the scheme are defined as follows: 
Research is original and planned investigation undertaken with the prospect of gaining new scientific or technical knowledge and understanding. 
Development is the application of research findings or other knowledge to a plan or design for the production of new or substantially improved materials, devices, products, processes, systems or services before the start of commercial production or use.

Eligible R&D activity is distinguished from other activity by the presence or absence of an appreciable element of innovation. If the activity departs from routine and breaks new ground it is normally R&D activity; if it follows an established pattern it is normally not R&D activity.

How do I demonstrate I had an eligible R&D programme in the pipeline?
Businesses that aren’t currently undertaking eligible R&D will need to show they had begun planning their R&D before 26 March. For example, they may have been in the process of applying for funding, or have started engaging a research provider before 26 March.

What if my business was established after 31 December 2019?
The aim of the R&D Loan Scheme is to help continue existing or planned eligible R&D that has been impacted by COVID-19. In some cases, we may consider businesses established after 31 December 2019, however you will need to show that the business had an eligible R&D plan in place as at 26 March and that the planned source of funds for that R&D plan have been impacted by COVID-19. If you fall into this category please get in touch with us via RDLoans@callaghaninnovation.govt.nz to discuss before applying. 

Can businesses use the funds for R&D done overseas?
A maximum of 10% of the loan funds can be spent on eligible R&D outside of New Zealand.

Can I apply for an R&D Loan if I have a Tech Incubator repayable grant?
Yes. The tech incubator loans are intended primarily as a commercialisation loan. Tech Incubator repayable grant recipients can spend a portion of their repayable grant on R&D but are encouraged to seek other sources of R&D funding (including government funds) if they intend to continue to do significant amounts of R&D. Please email RDLoans@callaghaninnovation.govt.nz if you have questions about this. 

If my R&D Loan application is approved, does that mean I am also approved for other R&D grants/services or the R&D Tax Incentive (RDTI)?
Approval for the R&D Loan does not constitute approval for other grants or the RDTI. Businesses will need to go through the regular application process for other support. 

Application details

What is the time period for businesses to apply for this loan?
The end date for applications to the scheme is 31 March 2021. However, we expect to see strong demand for the scheme, and it is awarded on a non-discretionary basis for businesses that meet the criteria. Businesses are encouraged to apply early to have the best chance of their application being accepted.

What information will I need to provide for financial viability?
Depending on your recent engagement in Callaghan Innovation R&D support, we will be asking for financial statements, management accounts, bank statements and a declaration of solvency. 

How do I prove that my R&D funding has been impacted by COVID-19?
You will need to describe in the application how COVID-19 has led to a 30% (or greater) drop in available funding for your eligible R&D activities.

What if I don’t currently have a Project Grant but intend to apply for one?
You need to note this in the application including when the Project Grant application is likely to be submitted and the estimated amount you will apply for. The value of your Project Grant may affect the total amount of R&D loan that you are entitled to.

Will I be able to submit further information once the assessment has started?
It is unlikely that you will be able to submit extra information once you have filed all the relevant information, and the assessment starts. Please make sure you read and consider your application material before and when submitting. If key information is missing we will likely return the application for you to provide this.

How will Callaghan Innovation assess that the loan funds are spent on R&D?
There will be an audit programme in place to ensure businesses are complying with the criteria. In addition to this, all applicants will need to confirm the funds will be spent on eligible R&D through a statutory declaration and will need to report back on this spending. 

I can’t log into the online application portal
If you have completed Stage 1 and are having difficulties with forgotten passwords or login details for our online portal (IMS), please email rdloans@callaghaninnovation.govt.nz with the subject heading ‘IMS login issues’. If you have not completed the Stage 1 form, you will need to do so to be set up in IMS.

What if I don’t have all the required application information?
Please note, we cannot begin to assess your application until we have received a fully completed application (with all documentation uploaded) from you. If you have submitted an application with information missing we will be in touch to follow up. If you are having issues with this please contact your Callaghan Innovation relationship manager.

I’m having trouble completing the application
Please contact your Callaghan Innovation relationship manager. 

I don’t have a Callaghan Innovation relationship manager. What do I do?
On completion of your Stage 1 submission you will be allocated a relationship manager. Please allow up to 3 business days for this allocation to occur after submission.
If you would like to reach out to your allocated relationship manager, please email RDLoans@callaghaninnovation.govt.nz with the subject heading ‘New relationship manager’.

What is Callaghan Innovation’s privacy policy?
You can check out our privacy policy on our website.

Next steps

When will I find out whether or not I have been approved for an R&D Loan?
We will complete a thorough assessment and review process before we notify you of the outcome. We are expecting a high volume of applications in the first few weeks but will be working hard to get through them as soon as possible. You can help by making sure you have all the information and documentation required submitted within the online IMS portal.

How will the loan funds be paid out?
Following the contracts being signed and approved, payment of approved funds will occur to your nominated bank account. You will be notified of the payment date once the signed loan contract has been returned.

What determines an application not being approved?
Applications for the R&D Loan Scheme are assessed against the eligibility criteria and filing all the appropriate documentation. 

My question isn’t answered on this page
If your question has not been answered above, contact your Callaghan Innovation relationship manager. If you don't yet have a relationship manager email RDLoans@callaghaninnovation.govt.nz

Updated: 10 July 2020