Frequently Asked Questions - Aboriginal Business & Entrepreneurship Development (ABED)
Q.1) How is the ABED changing?
The delivery of the Aboriginal Business Entrepreneurship Development, formerly called Aboriginal Business Canada (ABC), changed on April 1, 2013. The implementation of the Program Delivery Partner Initiative (PDP) is in response to the government's need to find more efficient and cost-effective ways of doing business. PDP is simply a change in the delivery model, moving the program delivery out of government control and into qualified Aboriginal Financial Institutions (AFIs). This change is designed to improve service to Aboriginal entrepreneurs by moving decision making closer to Aboriginal entrepreneurs and communities.
All AFIs are authorized to make non-repayable contributions to a maximum of up to $99,999 to Aboriginal entrepreneurs and up to $250,000 to community-owned Aboriginal businesses under the authority of the ABED's terms and conditions, while respecting program eligibility criteria, operational guidelines, and policies.
Q.2) How do I contact an AFI in my area?
A list of AFI offices has been provided and if you should have any other questions, please contact your regional AANDC office.
Q.3) Will the AFIs under a PDP arrangement follow the same policies and procedures as those used by the AANDC regional office when they delivered the ABED program?
Yes, the program criteria and policies remain the same; the only change is the delivery approach. All AFIs will be authorized to make non-repayable contributions to a maximum of up to $99,999 to Aboriginal entrepreneurs and up to $250,000 to community-owned Aboriginal businesses under the authority of the ABED's terms and conditions, while respecting program eligibility criteria, operational guidelines, and policies.
Q.4) Is the funding available the same for clients as under the ABED program?
Yes, the level of assistance remains the same. AFI can issue a funding agreement of up to $99,999 for individuals and up to $250,000 for community-owned business projects. For projects requiring a non-repayable contribution in excess of $250,000, the proposal will be redirected to an AANDC regional office. For large projects the maximum authorized non repayable assistance will be limited to $250,000. If more capital is needed, an AFI can offer debt financing.
Q.5) What are the funding limits for community business projects?
Projects of more than $250,000 and less than $1 million will be redirected to AANDC regional offices.
Q.6) Do I have to finance a commercial loan through an AFI to get the ABED non-repayable contribution?
An AFI will be responsible for the delivery of the ABED under a Program Delivery Partner agreement consistent with established program eligibility criteria, operational guidelines and policies. It is at the client's discretion to apply to either an AFI or to a commercial financial institution for a commercial loan.
Q.7) Will the time frame for approval be the same as under the ABED program when it was managed by AANDC regional office?
The approval process is expected to be faster under the Program Delivery Partner arrangement by enhancing the AFIs role and removing AANDC as the intermediary in the process. The length of time it takes for funding decisions should improve as AFIs can be more responsive to local needs and opportunities.
Q.8) What type of support will AANDC provide to AFIs once the PDP agreement is in place?
AANDC will support any AFI in setting up their operations to deliver the Aboriginal Business Entrepreneurship Development as a Program Delivery Partner. In addition, there is an Institutional Development Officer in each region whose role is to work with and provide customized training to the AFIs, as required. Since 2003, the National Aboriginal Capital Corporations Association (NACCA) has been assisting the AFIs to build their capacity as well as improve access to capital for Aboriginal businesses.
Q.9) If an AFI has been in receipt of funding for projects such as business awards, conferences, marketing plans, consulting, how are these projects going to be funded in the future?
Support for Research and Advocacy activities will need to be directed to AANDC, as AFIs are not able to use program dollars for research and advocacy activities.
Q.10) What are the Program Delivery Partner (PDP) reporting requirements?
The Program Delivery Partner funding agreement will outline the reduced reporting requirements: e.g. audited financial statements, reporting on the number of business projects funded, total value ($) of business projects funded, average value ($) of a business project funded and the operational cost per business project funded.
Q.11) What is the length of the PDP contract?
All current PDP contracts will cease to be in effect as of March 31, 2015. Starting in April 2015, AANDC in collaboration with AFIs will be introducing a new suite of programs designed to enhance developmental lending and access to other types of capital needed to advance Aboriginal business development.
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