Are you a small business owner or an entrepreneur looking for funding? The Elgin Business Resource Centre (EBRC) may be able to provide you with the funding you need to get your idea off the ground or make valuable improvements to your existing operation. As Elgin County’s Community Futures Development Corporation, The EBRC is able to provide qualified entrepreneurs, established businesses and co-operatives with business loans of up to $250,000 and micro loans of up to $ 5,000. These loans must be used to directly affect the growth of the business. New projects, working capital and equipment purchases are eligible but mortgages are not.
With its funds and mandate coming from Federal Economic Development Agency of Canada (FedDev), the EBRC is able to consider higher risk loans to businesses that traditional lenders may not. In order to be eligible for an EBRC loan, applicants must have first approached and been denied by, two traditional lending institutions. The goal of the EBRC is to help new businesses with great plans but no proven track record go from high risk start-ups to bankable. The organization is interested in the story of the business or business idea. How will it benefit Elgin County and St. Thomas? Will it create jobs? Is the idea original and will it add diversity to the local economy?
Although the EBRC’s lending criteria are less risk adverse than traditional lenders, it still undertakes an in-depth analysis of each loan applicant that is based on the 5 C’s of Credit:
Credit Worthiness – the EBRC will review the applicant’s credit score to determine history of borrowing and credit management including amount of debt, payment history and timeliness of payments.
Capacity – What income does the applicant have available to repay the loan as it becomes due? Will the business generate income in excess of its expenses?
Collateral – What will the applicant liquidate (sell) in order to pay the loan if the business fails to make payments?
Capital – What resources has the applicant invested in the business? Traditional lenders will not consider any applicants who have invested less that 35% of the value of the loan; however, the EBRC will consider as little as 10% invested.
Capabilities – The best way to evaluate the applicant’s capability is to review his/her business plan. What are the qualifications of the owner? Who are his/her professional advisors? What plans exist for marketing, operating, and financing the business?
If a business owner or aspiring entrepreneur is able to meet these criteria, he/she may be eligible to receive funding. For more detailed information about the loans process or to book a consultation with a knowledgeable staff member at one of the EBRC’s three office locations (Aylmer, Dutton and St. Thomas) call (519) 633-7597 or visit www.elginbusinessresourcecentre.com.