What does the UK-EU trade deal mean for my small business?

On Monday 19th May 2025, Prime Minister Keir Starmer announced a “reset” of the UK’s relationship with the European Union. Five years after Brexit, the UK and EU have reached a trade deal that the Prime Minister says will deliver a huge boost to economic growth.

This latest agreement comes after the UK secured trade deals with both India and the US in recent weeks, which the Government believe will help small businesses as well as the wider UK economy.

So, what does the UK-EU trade deal mean for the UK’s small businesses, and how might it affect yours? Here, we explain the key points of the deal and how it could impact your business. 

“Reduced friction and increased trade”

To coincide with the announcement, Funding Circle CEO Lisa Jacobs joined Chancellor Rachel Reeves at No 11 Downing Street for a gathering of business leaders and investors focusing on enhancing the UK’s strategic partnership with the EU.

Of the agreement, Lisa said: “I hope this deal strengthens the UK’s position as a great place to start and grow a business, leading to reduced friction and increased trade for our SME customers as they look to scale beyond the UK.” 

Will my business be affected by the UK-EU trade deal?

With the EU being the UK’s largest trading partner, this deal is expected to open up access to the EU market. As a result, it’s believed that consumers and businesses alike will benefit from a boost to the economy, lower food costs, and more choice on the shelves.

The businesses most affected by this new trade deal between the UK and the EU will be food and drink producers, and the fishing industry. 

How will the UK-EU trade deal affect food and drink producers?

A key part of the deal is a reduction in red tape for businesses that export food and drink to the EU. Over the past few years, small businesses have been particularly hard hit by increasing regulation, designed to prevent the spread of disease and ensure food safety.

It is thought that the new SPS (Sanitary and Phytosanitary Measures) agreement, which sets out rules for food safety and animal and plant health regulations, will be beneficial for small businesses by making exporting cheaper, easier and quicker. It will:

• Cut paperwork
• Reduce costs required as a result of extra checks
• Ease supply chain disruption by speeding up processing times at the border 
• Provide certainty for future planning as the deal has no time limit 
• Allow the free movement of goods between the UK and EU, as well as Great Britain and Northern Ireland, with some checks on animal and plant products removed completely

How will the UK-EU trade deal affect the fishing industry?

As part of the original Brexit deal, European fishers’ access to British waters was due to be revoked at the end of June 2026. This new agreement extends EU fishing access to British waters for an additional 12 years.

At the same time, the Government announced a £360 million investment in fishing communities through the Fishing and Coastal Growth Fund. This fund is designed to help:

• Modernise the British fishing fleet
• Improve skills and training
• Revitalise coastal communities 

If you think this new trade deal will affect your business and you are considering finance to free up cash flow or invest for growth, we can help. Explore your options on our website.

26/05/25: While we want to help as much as we can, the information found here is provided solely for informational purposes and should not be considered financial or legal advice. To the extent permitted by law, Funding Circle does not accept any liability for any loss or damage which may arise directly or indirectly from the use of, or reliance on, the information contained here. If you have any questions, please speak to your professional adviser or seek independent legal advice.