Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99per week for the first 24weeks
Just $1.99per week for the first 24weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

An Indigenous fund first announced in the 2019 federal budget expects to start steering loans to businesses by the end of the year, backed by additional government contributions that bring the fund’s first close to $150-million.

The Indigenous Growth Fund, announced as a $100-million initiative in 2019, will be managed by the National Aboriginal Capital Corporations Association, an umbrella group for lending agencies known as Aboriginal Financial Institutions, or AFIs.

Over the past three decades, those federally funded AFIs have provided nearly 50,000 loans worth close to $3-billion. But that figure could have been higher – and more businesses and communities would have benefited as a result – if the AFIs had more capital to manage, said NACCA chief executive officer Shannin Metatawabin.

Story continues below advertisement

“Every year, our [AFI] clients are saying no to opportunities because they don’t have any capital – they’re waiting for capital to be repaid before they can issue a new loan,” Mr. Metatawabin said in a recent interview.

The AFI network, made up of more than 50 groups across the country, currently lends about $125-million each year.

The fund’s close, to be announced Wednesday, combines the $100-million announced in 2019 (which included $50-million from the Business Development Bank of Canada, or BDC, and $50-million in other federal funding) with $50-million in new contributions from Export Development Canada and Farm Credit Canada.

The fund is designed to be “evergreen” – that is, open-ended without a set closing date – and to allow private investors to participate.

Funds will be distributed to AFIs, which are expected to make loans based on local contacts and experience.

“We decided to enter into this partnership with NACCA because it was a way for us to get much better reach into the community of Indigenous entrepreneurs across the country than we would be able to do on our own,” said Michael Denham, CEO of BDC.

The fund is designed to address what has long been recognized as one of the biggest barriers for First Nations, Inuit and Métis entrepreneurs: access to capital.

Story continues below advertisement

Would-be Indigenous borrowers may lack a credit history or collateral, reflecting regulatory and systemic barriers. (In general, on-reserve property is held collectively, limiting residents’ ability to borrow against homes or other real estate.)

Sunshine Tenasco is the founder of Her Braids and the CEO of Pow Wow Pitch.

Handout

“The door is pretty much closed on [conventional bank financing],” said Sunshine Tenasco, the founder of Her Braids, a jewellery and design business, and CEO of Pow Wow Pitch, a group that provides financial prizes to Indigenous entrepreneurs.

“For women who live, especially in community, on reserve, there’s no collateral – you’re already seen as high risk. Add to that the fact that you’re a woman, add children in the mix … all those things in the mix, they [banks] just won’t take that chance on you,” Ms. Tenasco said.

Through AFIs, the new fund is expected to provide loans in the $25,000 to $1-million range. Currently, the average loan size across the network is about $100,000 and there’s a need to bridge the gap between small loans and the $1-million threshold, when entities become more “bankable,” said NACCA’s Frank Richter, managing director for the Indigenous Growth Fund.

Trent Fequet, president and CEO of Calgary-based Steel River Group, a management group for Indigenous-led businesses, welcomed the idea of an Indigenous-focused fund.

“It’s another way to allow Indigenous entrepreneurs to access some funding – and that’s phenomenal,” said Mr. Fequet, adding that he still sees a funding gap for larger businesses.

Story continues below advertisement

“I think maybe the next wave for government is to look at larger businesses, and whether there’s an opportunity to look at ways to support them a little better.”

Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies