Indigenous women entrepreneurs face unique challenges when accessing financing to start or grow their businesses. However, the National Aboriginal Capital Corporations Association (NACCA) is working to level the playing field and provide Indigenous women with the support they need to achieve their business goals. This article explores the various supports available for Indigenous women entrepreneurs through NACCA Indigenous Financial Institutions.
Supporting Indigenous Financial Institutions
NACCA is a national Indigenous organization based in Ottawa, Ontario, representing a network of over 50 Indigenous Financial Institutions (IFI) across Canada. Its role is to advocate for IFIs, administer some of the programs they deliver, and provide capacity-building services. Each IFI is a unique, Indigenous-owned, controlled, and community-based organization. Over the last three decades, the NACCA network has provided over 50,000 loans totalling over $3 billion to Indigenous businesses.
Addressing Access to Finance for Indigenous Women Entrepreneurs
According to the research conducted by NACCA, Indigenous women make up about 41% of the self-employed Indigenous population in Canada, while Indigenous men make up 59%. However, the growth rate between Indigenous women's participation in self-employment compared to Indigenous men is much higher. This means that more and more Indigenous women are getting into business, and it is crucial to support them. Unfortunately, only 28% of all the businesses supported by the NACCA network are owned 100% by Indigenous women, and Indigenous women partially own an additional 6%.
Access to financing is the top challenge for Indigenous women entrepreneurs. However, NACCA's research shows that if programs are available, there are many benefits to Indigenous women lenders, such as fewer loan write-offs and more calculated, rational business decisions.
Indigenous Women Entrepreneurship Program
With this information, NACCA launched the Indigenous Women Entrepreneurship Program in March 2022. Indigenous Services Canada funds the program, and 32 NACCA's IFIs participate nationwide. NACCA has also hired over 25 dedicated business support officers to work within their offices to provide advisory services, mentorship, and a range of workshops and training to Indigenous women entrepreneurs.
The program offers microloans and grants and is open to any industry. Indigenous women entrepreneurs with part-time or home-based businesses that otherwise wouldn't be eligible for other types of financing can access the program.Under the Microloan Fund, women can access loans up to $20,000; non-repayable contributions or grant dollars are available. The interest rate is reduced and set by each individual based on risk. Women entrepreneurs must have a minimum of 5% cash equity, as most IFIs require 10% to qualify for the microloan. The loan term ranges from three to five years. The program supports businesses that are majority owned and controlled by Indigenous women. Eligible costs can be related to labour, capital, operating and working capital, marketing, and advisory services. Not-for-profit organizations are not eligible, and husband-and-wife businesses do not qualify because they're considered 50/50 ownership.
Women Entrepreneurship Loan Fund
In addition to the Microloan Fund, NACCA also launched the new Women Entrepreneurship Loan Fund in September 2022, a national microloan fund that provides loans of up to $50,000 to Indigenous women entrepreneurs. This fund is delivered by five delivery organizations, including NACCA and the IFIs, and is open to all industries and sectors. No grant or contribution funds are available under this program, but the maximum interest rate is prime plus 4%. Eligibility criteria are similar to the Microloan Fund, with the maximum loan size being $50,000.
It's important to note that NACCA is not directly delivering these programs to Indigenous women entrepreneurs but through its network of over IFIs across Canada.
The Indigenous Women Entrepreneurship Program and its associated funds are crucial in addressing the unique needs and challenges faced by Indigenous women entrepreneurs in Canada. By providing access to financing, training, mentorship and support, these programs are helping to level the playing field and ensure that Indigenous women have the tools they need to succeed in business.
If you're an Indigenous woman entrepreneur looking to access these programs, you can locate your nearest IFI to learn about its process. You can click here to find your local IFI. With the right tools and support, you can achieve your business dreams and contribute to the economic success of Indigenous communities across Canada.