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The Small Aircraft Transportation (SAT) segment represented mainly by helicopters, piston fixed-wing aircraft, turboprop aircraft, and business jets requires a reliable source of navigation information with an appropriate price. This paper describes the research and development activity funded by Clean Sky 2 Cost Optimized Avionic Systems (COAST) development program targeting affordable hybrid navigation solutions. The affordability is driven by size, weight, and power consumption (SWAP) requirements. The desired level of accuracy, integrity, and availability is being achieved by a hybrid navigation solution based on GPS/INS fusion extended by other navigation sensors. The hybrid core of the systems uses GPS with SBAS augmentation to outperform standard tightly coupled GPS-based hybrid systems. The purpose of this article is to describe the current state, algorithmic structure, and hardware maturity of the navigation system prototype. The paper describes individual hardware components, points to the resulting prototype, and summarizes tests in a representative environment. The ultimate goal is to demonstrate the overall performance of the hybrid system based on a low-cost micro-electro-mechanical system (MEMS) Inertial Measurement Unit (IMU). The low-cost inertial sensor is one of the key components securing the affordability of the proposed system, so its testing plays important role. Another assumption considered in the system design was integration of standardly-used onboard sensors. For this purpose, the hardware prototype was tested in a demonstrative and outdoor environment. The results of this exercise are summarized in this paper.