The UK visa system is failing international graduate entrepreneurs who want to start a business, according to a new survey by The Entrepreneurs Network.

The UK visa system is failing international graduate entrepreneurs who want to start a business, according to a new survey by cross-party think tank The Entrepreneurs Network.

The report, Made in the UK: Unlocking the Door to International Entrepreneurs, which questioned 1,599 graduate international students, found that while 42 per cent of international students intend to start up their own business following graduation, only 33 per cent of these students, or 14 per cent of the total, are looking to do so in the UK.

To encourage international graduates to start businesses in the UK, the Tier 1 (Graduate Entrepreneur) visa was set up. However, the survey suggested that students were not entirely convinced by it with just 2 per cent of respondents expecting to start a business following graduation applying for the UK Tier 1 (Graduate Entrepreneur) visa, while 62 per cent, said they didn’t even consider it.

“This report shows that our visa system isn’t supporting the entrepreneurial ambitions of international graduates,” said Philip Salter, director of The Entrepreneurs Network.

“In its current form, the Tier 1 (Graduate Entrepreneur) visa isn’t fit for purpose. We are training some of the world’s best and brightest young people at our world-class universities only to push them to set up their businesses overseas," he added.

The survey revealed that only 18 per cent of those questioned think that the UK has better post-study processes in place for international students than other countries, compared to 32 per cent that think it is worse than other countries.

Despite 101 of the 163 UK Universities being certified by the Home Office, only 46 per cent of of those surveyed think their institution is certified to endorse them for a Tier 1 (Graduate Entrepreneur) visa, while 43 per cent were not sure.

The report puts forward a number recommendations for the UK government to reduce the burdensome regime students face when applying, including the reinstatement of a post-study work visa, to allow international students to explore markets and industry before finalising their business idea for the Tier 1 (Graduate Entrepreneur) application.

The report also suggested removing the risk for educational institutions in endorsing international graduates for Tier 1 (Graduate Entrepreneur) visas from institutions’ Tier 4 license.

Tier 1 visas enable high net worth individuals to get a visa by either investing £1 million ($1.65 million) of their own money in the UK, with 75 per cent of these funds invested in government bonds or loan or share capital in UK registered trading companies.

The UK government has recently pushed ahead with a proposal to double the minimum threshold of the country’s Tier 1 investment visa to £2 million ($3.2 million). The measure comes against a background of various jurisdictions such as Malta and Spain rolling out immigration programmes for wealthy individuals in recent years.

Earlier this year, Malta launched its Investors Programme, which carries citizenship rights. Under the scheme, citizenship is granted to investors contributing at least €650,000 ($878,000), while spouses and minor children can also become citizens for a sum of €25,000. However, it has prompted controversy with members of the European Parliament which has criticised it for being lax and for cheapening EU citizenship. As a result of pressure, the government said applicants must be resident in Malta for at least a year to qualify.

Last year, Spain also implemented a new law offering non-Europeans residency in exchange for cash. The so-called Golden Visas were introduced to attract foreign investment and boost demand for property and offers residency permits to non-EU nationals in return for an investment of at least €500,000 into residential or commercial property.

Both schemes give freedom of movement throughout the 26 European countries covered by the Schengen Agreement.