$8.3 million to help Indian businesses

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The federal government is pumping $8.3 million into Native economic development through a lending institution called the Alberta Indian Investment Corporation.

The funding is expected to create more than 500 new jobs and 250 Indian-owned businesses, generating up to $27 million into the province's economy over the next decade.

The corporation is owned by the Indian Equity Foundation of Alberta, which is owned by the province's 42 Indian bands, and serves the Treaty Indian business community. Individual loans of up to $400,000 are available to those who are Treaty and are majority (51 per cent) owners of their businesses.

The corporation, which held its opening ceremonies at Edmonton on Feb. 11, will provide business advisory and referral services as well as competitive interest rates on loans to Native entrepreneurs, according to Harold Gray, business development manager of the corporation. He explains the corporation will assist existing managerial and entrepreneurial training programs that are being offered to Native people today.

Gray says the corporation will give loans to Native entrepreneurs that might not otherwise be obtainable through mainstream banks. He explains most of the mainstream banks consider Native businesses a "High risk," making it difficult for Natives to get loans.

Gray adds the corporation will provide loans to Native people with a lower equity base than other banks which will mean that Native applicants can get a loan from the organization with less collateral. However, he says there will still be strict guidelines governing the loans procedure and clients will be expected to do their homework before making application. "We expect the client to do a lot of the leg work and research about the prospective business they want to start," he says, adding the corporation will steer the clients in the proper direction and show them what they expect.

The corporation is also planning to give annual incentive-building scholarships and awards. The scholarships, which will be given to two students at the post-secondary level in business development, are called the Senator James Gladstone Memorial Scholarships. The awards for the Indian business of the year and businessperson of the year are called the Honourable Ralph Steinhauer Awards.

The Department of Indian Affairs will be channelling $2.5 million into the corporation over the next five years to help the fledgling operation get established. The corporation is currently operating with a capital base of about $10 million.