New Lending Tool has Successful Year

first_imgNova Scotia’s newest lending tool for small business gets topmarks according to its first annual evaluation. With about $5million in loans to 66 small businesses, the Credit UnionFinancing/Loan Guarantee Program helped to create more than 280jobs since its inception in June 2003. “Getting a top grade from participants is a real bonus for boththe province and the credit union system,” said EconomicDevelopment Minister Ernest Fage. “The evaluation shows theprogram is doing what was intended and participants are alsoproducing remarkable results.” The three-year pilot program, which is guaranteed by theprovince, is a partnership between Nova Scotia EconomicDevelopment, the Nova Scotia Credit Union system and the NovaScotia Co-operative Council. “The supportive partnership of the credit unions, the provinceand the co-op council makes this program stand out from otheravailable financial lending programs,” said Bernie O’Neil,president and CEO of Credit Union Central of Nova Scotia. “Todate there have been no defaults or arrears, and that’s a goodindication that wise decisions are being made by local lendingcommittees across the province.” The province has committed $6 million in loan guarantees overthree years to help meet the financing needs of small business.The credit unions are assuming the risk on the remaining balanceof $2 million in order to make $8 million available for lending.The program is administered by the Nova Scotia Co-operativeCouncil and loans are approved by regional lending committees,ensuring the decision-making stays local. Once approved, thelocal credit union issues the loan and monitors compliance. “The credit unions, which make up Nova Scotia’s largest financialco-operative, reflect the commitment of the co-operative sectoras a whole to Nova Scotia’s small business community,” saidDianne Kelderman, chief executive officer of the Nova Scotia Co-operatives Council. “By administering this program, the creditunions are also demonstrating commitment to the province’sstrategy to grow the economy through greater access to capital.” The evaluation shows that the program has exceeded expectationsand should be continued. It also shows that the program shouldwork toward increasing the participation of disadvantaged groupsoriginally targeted by the program, including youth andentrepreneurs with disabilities. With the end of its first year,and an official evaluation completed, the program will bedeveloping a more focused approach to these groups. Loans up to $150,000 are available through the program. Theprovince guarantees up to 75 per cent of the loan and creditunions are responsible for the remaining 25 per cent. Theprovince is also providing $50,000 annually to cover theprogram’s operating costs. Small business owners are encouraged to approach their localcredit union to get more information on the program.last_img

Leave a Reply

Your email address will not be published. Required fields are marked *