The federal government and a pair of Indigenous lending institutions are giving small- and medium-sized business owners a break in the wake of the COVID-19 pandemic.
Last week, the federal Indigenous Services department, the National Aboriginal Capital Corporations Association (NACCA) and Métis Capital Corporations, announced they would forgive 50 percent of the COVID-19 Indigenous Business Initiatives loans incurred by the nearly 4,000 Indigenous entrepreneurs across Canada over the last few years.
The feds touted the loan forgiveness as a panacea for Indigenous entrepreneurs forced to switch gears to stay afloat during the lockdowns.
For example, an Indigenous-owned café in Vancouver called Nemesis Coffee had to close its café and bakery to convert to a takeout model and halt construction on other projects. They were able to receive support through the Indigenous Business Initiative, which allowed them to keep the lights on and remain resilient throughout.
Federal Indigenous Services minister Patty Hajdu cited the café as a concrete example of how the Indigenous Business Initiatives loans helped small businesses during the COVID-19 lockdown.
“At the onset of the pandemic, Nemesis Coffee in Vancouver closed their café and bakery for in-person service and converted to a takeout model. The business also had to halt construction on other projects. However, with support through the COVID Indigenous Business Initiative, they are still going strong,” Hajdu said. “The company has survived and thrived, and continues to contribute to the local economy by creating good jobs, many of them for young people. Indigenous-owned businesses across the country, like many others, have struggled to continue operating during this unprecedented time of disruption related to COVID-19 measures.”
Hajdu added the loan forgiveness will give the approximately 3,800 entrepreneurs across Canada who took advantage of the program a little breathing room. The amount of the loan forgiveness is in the area of $82.5 million, she said.
NACCA CEO Shannin Metatawabin called the COVID-19 pandemic a “unique” situation that was unprecedented in contemporary history and said because Indigenous businesses are heavily concentrated in sectors disproportionately affected by COVID-19, it only made sense to forgive the loans.
"Indigenous businesses are heavily concentrated in sectors that were disproportionately affected by COVID-19 mitigation measures. The National Aboriginal Capital Corporations Association (NACCA) and our Indigenous Financial Institution network lobbied governments for an emergency loan program tailored to the unique situations of our Indigenous business clients,” she said. “By June 2021, NACCA and 37 financial institutions had delivered the capital and care they needed to survive, providing just under $160 million to over 3,000 Indigenous businesses. It is a testimony to our network's strength that we were able to design and deliver the program in such a short time. NACCA continues to offer businesses support during their recovery from coast to coast to coast."
In total, the initiative provided $306.8 million to Indigenous businesses across Canada in the form of interest-free loans and non-repayable contributions.
Marc Lalonde, Local Journalism Initiative Reporter, Iori:wase