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New Financing Opportunities for Alberta Small Businesses
This July, ATB and the Business Development Bank of Canada announced they were partnering to lend $1 billion ($500 million each) to small businesses in Alberta, across all sectors. In the announcement, ATB CEO Dave Mowat stressed that the most important time to fund small businesses is during a rebound, saying, “That’s when businesses can really start to grow, and we want to help provide that opportunity.” The loans complement recent small-business-focused efforts from both banks: ATB opened two entrepreneur centres in May, where entrepreneurs can both bank and collaborate with other small business owners, as well as a “Free Banking for Startups” package that includes a free full-service chequing account and access to other government and corporate banking services. Meanwhile, BDC had already made $500 million in new loans available to Alberta businesses in November. There are other new financing options for small businesses, too. The Alberta Securities Commission unveiled in July two new initiatives designed to help small and medium-sized businesses raise capital. One involves a prospectus exemption for small businesses, which means startups can raise small amounts of capital from individual investors from Alberta ($1,500 per distribution to a maximum of $5,000) independent of a funding portal or registered dealer. The other pertains to crowdfunding – something that Alberta has been reluctant to embrace – as it would allow Alberta issuers to raise larger amounts of capital through multi-jurisdictional crowdfunding campaigns. Individuals can invest up to $2,500, to a maximum of $25,000. Stan Magidson, the chair and CEO of the ASC, says, “We believe these are important steps to support Alberta’s economy during one of the most severe recessions our province has ever endured.”