The bottom line: There is more public funding available for UK small business AI adoption right now than at any previous point. A £12m London-specific programme and a new national AI Growth Lab from DSIT mean there are two distinct routes to funded AI support — one regional, one national — depending on where your business is based and what sector you operate in.
The London programme: what was announced
Mayor Sadiq Khan announced the £12 million AI investment package as part of London's broader productivity strategy for 2026. The programme is targeted specifically at London-based SMBs — businesses with fewer than 250 employees — to support them in identifying, implementing, and measuring AI adoption in their operations.
The productivity gap between businesses that use AI occasionally and those that have embedded it into core workflows is the core problem this fund is trying to address. UK SMB AI adoption has grown from roughly 15% in 2024 to 54% in 2026 according to British Chambers of Commerce data. But the leap from "I've tried ChatGPT a few times" to "AI is embedded in how we actually run the business" requires support — structured guidance, implementation expertise, and in many cases funding for tooling or advisory time. The London Mayor's programme is designed to bridge that gap for London businesses.
The fund covers a mix of support types: advisory and implementation guidance for SMBs to identify where AI offers the most productivity gains, funding towards AI tooling and software for qualifying businesses, and structured learning resources for business owners and staff. The specific grant vs voucher vs advisory breakdown is still being confirmed through the programme delivery mechanism — full details are available at london.gov.uk/business.
The programme is verified from the Mayor's office press release published via the Greater London Authority. Specific application windows and eligibility criteria will be confirmed on the london.gov.uk business support pages as the programme delivery is set up.
Who qualifies for the London fund
The programme is focused on London-based SMBs. For the purposes of this fund, small and medium-sized businesses are defined as organisations with up to 250 employees operating within the Greater London area. Businesses must be registered and operating in London — not simply working with London clients from outside the city.
The sectors prioritised for early access include professional services, retail, hospitality, creative industries, and the trades — areas where the London economy has significant SMB density and where the AI productivity gap is most measurable. If your business is in one of these sectors and is based in London, you are squarely in the target group for this programme.
The national picture: DSIT AI Growth Lab
The AI Growth Lab is a different type of support from the London fund. Rather than direct funding for SMBs, it creates regulatory sandbox environments where businesses in priority sectors can deploy AI with temporarily relaxed regulatory constraints — allowing real-world AI implementation at scale without waiting for sector-specific AI regulation to be finalised. The first cohort covers legal services and conveyancing, with professional services, healthcare, and transport sectors confirmed as next in the queue.
The AI Growth Lab matters for UK businesses outside London as much as inside. If you operate in legal services, professional services, healthcare, or transport, the Growth Lab may offer a route to deploy AI in your business ahead of formal regulatory frameworks — with government oversight but without the compliance uncertainty that holds many businesses back from implementation.
The source for the AI Growth Lab is DSIT official communications published via gov.uk. Details on applying for sandbox participation are available through the DSIT AI page at gov.uk/dsit.
What to do: three steps for UK operators
Step 1 — If you are London-based: check the London AI support programme directly
Go to london.gov.uk and search for the AI business support programme. The programme details, application process, and eligibility criteria will be live on that page. If the programme is not yet open for applications at the time you check, register your interest — London GLA business support programmes typically operate on a first-come basis once open. Do not wait until a later date to check; funded programmes of this size fill quickly once applications open.
Step 2 — Regardless of location: check the DSIT AI Opportunities Action Plan for national support
The national AI Opportunities Action Plan (published January 2026, updated June 2026) includes provisions for AI adoption support across the UK that are not London-specific. These include funding for AI skills training, vouchers for AI tooling, and support for businesses participating in sector-specific AI pilots. The plan details are on gov.uk — search for "AI Opportunities Action Plan" to find the current version and application routes.
Step 3 — If your sector is legal, professional services, healthcare, or transport: explore the AI Growth Lab
The DSIT AI Growth Lab regulatory sandbox is specifically designed for businesses in sectors where AI deployment is constrained by regulatory uncertainty. If you operate in one of the four priority sectors, the sandbox may allow you to implement AI workflows that you have been holding back due to compliance concerns — with government support to navigate the regulatory environment. Contact DSIT via gov.uk/dsit for details on how to express interest in the next cohort.
The combination of the London Mayor's fund and the national DSIT programme means UK businesses have genuine funded support routes available for AI adoption in June 2026. These do not require large technical teams or enterprise budgets to access. They are designed for the kind of business most likely to be reading this: service-oriented, owner-led, practical about AI, and looking for support to take the next step beyond occasional usage into embedded operations.