Globe and Mail Update
Jim Richardson, National Director, Aboriginal Banking, BDC {Business Development Bank of Canada – BDC}
A status Indian from the Mi'kmaq reserve of Pabineau, New Brunswick, Jim served as a senior officer with the Canadian Armed Forces and gained experience at the senior level in Government and the private sector before joining BDC. A Queen's MBA graduate, Jim is currently in charge of Aboriginal Banking for BDC where he has developed a number of unique products aimed at increasing access to capital for Aboriginal economic development.
ABORIGINAL MARKET INITIATIVES
Gil Winters, from Washington, D.C. asks:
"I'm interested in learning more about the BDC lending circle process. How would a student apply for a loan? What are the lending requirements?"
Dear Gil, thank you for your question. BDC announced two major Aboriginal banking initiatives last week: a new Business Development Fund for Aboriginal entrepreneurs from the Fort McMurray, Alberta area, in partnership with Keyano College, as well as a new lending circle fund in partnership with Ponoka Outreach High School in Ponoka, Alberta.
BDC's Aboriginal Banking unit has a mandate to lead BDC's initiatives in the Aboriginal market with the objective of contributing to the creation and sustainability of Aboriginal entrepreneurship in Canada. A variety of initiatives are developed every year by BDC. Across the country, Aboriginal communities show higher rates of new business and self-employment than the average, with more than 20,000 Aboriginals currently running their own businesses.
Last week, we announced the creation of the Aboriginal Youth Lending Circle (AYLC) to support youth entrepreneurship in high schools. Students from Ponoka Outreach High School now have the opportunity to develop entrepreneurial skills while accessing actual financing of up to one thousand dollars per project for their business plan.
Under the AYLC program, Ponoka Outreach offers students training on entrepreneurship and business and covers topics such as HR, financial planning, marketing and problem resolution. The Aboriginal Youth Entrepreneurship course features Interactive Business Planning Resources And Access To Mentors Online. Students will have the opportunity to take the business plan they developed in a classroom setting to the next level by applying for a loan. The loan application will be presented to a credit committee with recommendations from the teacher. It is envisioned that students will apply in groups of two or three but they can also apply individually.
BDC also announced a partnership agreement with Keyano College to create a new Aboriginal Business Development Fund (ABDF) to benefit entrepreneurs from the Fort McMurray area. BDC invested a total of $250,000 in capital for the loan fund. Qualified entrepreneurs will be able to obtain business loans of up to $20,000 through the ABDF.
Keyano College will identify entrepreneurs who are potential loan candidates. Through the school's Aboriginal Entrepreneurship course, candidates will be offered business training including mentoring and education. The emphasis will be placed on the Candidate's Management Capacity, Business Feasibility, And Commitment as opposed to equity and security, as it is the case with standard business loans. There are a number of other ABDF pilot initiatives in other regions of Canada and they all combine management training and mentorship with financing. BDC has committed a total of $1 million to the ABDF initiative.
Other initiatives developed by BDC's Aboriginal Banking Unit include E-Spirit, an annual Aboriginal Youth Business Plan Competition with enrollment of 500 Aboriginal students representing up to 100 schools from all regions of Canada. You can visit www.espirit.ca for more info.
BDC also set up Peer Lending For Aboriginal Entrepreneurs And A Quarterly Magazine Focusing On Aboriginal Youth Role Models, while BDC Consulting helped the first Aboriginal community in North America — Membertou First Nations — to become ISO certified.
BDC is active in the Aboriginal markets through its wide range of financing and consulting solutions.
Please visit www.bdc.ca for more information.
CONTEMPORARY ABORIGINAL BANKING INITIATIVES
1. ABORIGINAL YOUTH LENDING CIRCLE (AYLC) [TO SUPPORT YOUTH ENTREPRENEURSHIP IN HIGH SCHOOLS].
2. ABORIGINAL YOUTH FINANCIAL OUTREACH [OFFERS STUDENTS TRAINING ON ENTREPRENEURSHIP AND BUSINESS AND COVERS TOPICS SUCH AS HR, FINANCIAL PLANNING, MARKETING AND PROBLEM RESOLUTION].
3. INTERACTIVE BUSINESS PLANNING RESOURCES AND ACCESS TO MENTORS ONLINE.
4. CANDIDATE'S MANAGEMENT CAPACITY, BUSINESS FEASIBILITY, AND COMMITMENT [AS OPPOSED TO EQUITY AND SECURITY, AS IT IS THE CASE WITH STANDARD BUSINESS LOANS].
5. E-SPIRIT, AN ANNUAL ABORIGINAL YOUTH BUSINESS PLAN COMPETITION [WITH ENROLLMENT OF 500 ABORIGINAL STUDENTS REPRESENTING UP TO 100 SCHOOLS FROM ALL REGIONS OF CANADA.]; AND
6. PEER LENDING FOR ABORIGINAL ENTREPRENEURS AND A QUARTERLY MAGAZINE [FOCUSING ON ABORIGINAL YOUTH ROLE MODELS].