Articles

Published April 1999

Canadian Business Financing: Grants and Loans for Young Entrepreneurs in Canada

By CO Staff

Access-2Capital | Preparation Steps | Financial Glossary | Award Programs | Loan Programs (Youth)

Accessing capital can be a frustrating process for young entrepreneurs. Banks are low risk lenders, and quite often young entrepreneurs are not able to meet the qualifying criteria for traditional loans. As a result, governments and organizations in many provinces offer secured loans, or possibly even grants, to qualifying young entrepreneurs.

Some programs address one of the key concern when lending to young entrepreneurs - the lack of experience and business skills - as a part of their loan programs. For example, the Business Development Bank's loan program for young entrepreneurs includes a training component that the entrepreneur must pay for in order to secure a loan.

The following table lists Canadian grant and loan programs for young entrepreneurs. Click on a province or region to link directly to information on that area, or scroll through the list for an overview of what is currently available in Canada. In addition to these loans, young entrepreneurs should also investigate industry-specific grant and loan programs.

Grants and Loans by Region:

Alberta | Manitoba | Ontario | Quebec | New Brunswick
Atlantic Canada | Western Canada | National Programs

Alberta:

Youth Entrepreneur Award of Distinction
The nominee(s) must be between the ages of 18 and 35. The Youth Entrepreneur Award recognizes outstanding achievement by young entrepreneurs. The award is given to the business that best exemplifies the qualities of effective leadership, innovatively applied know-how, and excellent potential for growth; that shows a high level of social, cultural, and environmental awareness and a demonstrated commitment to the wider community; and that engages in continuous learning or other improvement opportunities designed to advance the economic, social, and environmental prospects of the enterprise.

Manitoba:

Business Start Program (BSP)
Business Start is designed to promote the success of new business start-ups by ensuring that entrepreneurs have fully researched their ideas by means of a comprehensive business plan, by offering business training and counselling, and by providing access to funding through a loan guarantee.

Skill Development for Young Entrepreneurs
Designed to enhance the skills of Manitoba's young people who have started, or plan to start, their own full-time business. Approved training will provide youth with the opportunity to improve their knowledge and skills to run a successful business. Under this program, approved applicants are eligible for a grant of up to $1000 or $1500 for northern residents, to assist with the costs of completing an accredited business-related training course.

Young Entrepreneurs Program
Designed to encourage Manitoba's young people to start their own full-time businesses and pursue self-employment as a career choice. Applications are accepted on a year-round basis from Manitoba youth aged 18 to 29 years. Under the Young Entrepreneurs program, approved applicants will be eligible for a grant of up to $4000 to help defray business start-up cost and capital expenditures.

Young Rural Aboriginal Entrepreneurship Initiative
Must be under 40 years of age. Must be of Aboriginal heritage (Status or Non-status Indian - located on or off-reserve- Metis or Inuit). The program funding can be used for: costs associated with the establishment of a business, activities such as seminars and workshops, educational tours or conferences, and the development of resource materials.

Ontario:

YOUTH ENTREPRENEURSHIP PARTNERSHIPS GRANTS FOR NON-PROFIT ORGANIZATIONS- provides funding of up to $100,000 per year for up to 3 years to non-profit organizations in Ontario that facilitate the development of an enterprising culture amongst Ontario's youth (typically between the ages of 12 - 29) by providing them with educational, experiential, and entrepreneurial opportunities and programs.

Young Entrepreneurs Program: Summer Company
Provices up to $3000 for students between 15 and 29 to start a summer business.

Northern Ontario Young Entrepreneur program
All residents of Northern Ontario, 18 to 29 who are planning on starting their own for-profit business in the North are eligible. Generally, funding does not have to be repaid and may cover up to 85 per cent of eligible costs, to a maximum of $25,000 per project.

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Quebec:

The Mayor's Foundation for Youth Entrepreneurship Program
Grants for Montrealers of all origins between 18 and 35 years of age Youth Investment Corporation. Provides loan guarantees of $10,000 up to $150,000 for 18 to 35 year olds.

Youth Investment Corporation- (no information available online) Provides loan guarantees of $10,000 up to $150,000 for 18 to 35 year olds.
Contact: Ministre de l'Industrie, du Commerce, de la Science et de la Technologie du Quebec. (514) 873-8335 or (514) 875-8674
Other programs also available through the same ministry.

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New Brunswick:

Small Business Loan Guarantee Program (SBLGP)
Provides loan guarantees to businesses in targeted sectors of the economy to stimulate capital investments for small business start-up and expansion. Program options include term loan guarantees, working capital loan guarantees for start-up businesses and working capital loan guarantees for existing businesses.

SEED / Student Entrepreneurship
Up to $20,000 for residents of Atlantic Canada. Applicants must be the majority owners of their businesses. Applicants under 35 years of age may use the loan to start-up, expand or modernize a business. Applicants 35 years of age and older may use the loan to start a new business only; see site for detailed criteria - for young entrepreneurs in New Brunswick, Newfoundland, Nova Scotia, and Prince Edward Island.

Yukon:

Youth Investment Fund
The Youth Investment Fund provides financial support to short term projects aimed at youth. These programs should promote self-esteem, encourage development of positive lifestyle choices, or create social or recreational opportunities. You must be under 19 to apply. Groups can apply for up to $5,000 twice yearly or up to $500 at any time.

Atlantic Canada:

SEED Capital Program
Seed Capital and Counselling Program-or-1-800-668-1010
- up to $20,000 for residents of Atlantic Canada and between the ages of 18 and 29 inclusive (applicants under the age of 19 require the co-signature of an adult); see site for detailed criteria- for young entrepreneurs in New Brunswick, Newfoundland, Nova Scotia, and Prince Edward Island

SEED / Student Entrepreneurship
Up to $20,000 for residents of Atlantic Canada. Applicants must be the majority owners of their businesses. Applicants under 35 years of age may use the loan to start-up, expand or modernize a business. Applicants 35 years of age and older may use the loan to start a new business only; see site for detailed criteria - for young entrepreneurs in New Brunswick, Newfoundland, Nova Scotia, and Prince Edward Island.

Western Canada:

Western Youth Entrepreneur Program
Offers loans up to $10,000. If you live in a Western Canadian community and are between the ages of 19 and 29 you may be eligible for support.

National Programs:

The Canadian Youth Business Foundation is the 'go to' place for youth entrepreneurship. As a national charity, we are dedicated to growing our nation's economy one young entrepreneur at a time. We look at character not collateral, when providing youth, age 18-34, with pre-launch coaching, business resources, start-up financing and mentoring, to help them launch and sustain a successful entrepreneurial business.

Aboriginal Business Canada
Provides financial assistance, information, resource materials and referrals to other possible sources of financing or business support to Aboriginal entrepreneurs in specific industries with broader support offered to Aboriginal individuals.

BDC's Young Entrepreneur Financing Program
Customized term financing up to $100,000 for new businesses demonstrating long-term viability.

Aboriginal Veterans Scholarship Trust
The scholarships support Aboriginal students who are pursuing post-secondary education in all areas related to economic development and self-government, such as technology studies, business, sciences, law and education.

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