Are You Seeking Small Business Financing? - Seed Capital Program
Metro Business Opportunities Corporation (MBO) administers Seed Capital Program funding on behalf of the Atlantic Canada Opportunities Agency (ACOA). Through research conducted by ACOA, it has been identified that access to capital is a major obstacle for small business entrepreneurs. In addition, access to business expertise and advice is difficult to obtain for such individuals. In response to these challenges, the Seed Capital Program was developed.
What Financial Assistance Will You Receive?
An applicant of the Seed Capital Program can access financing up to a maximum of $20,000. An individual can access the Seed Capital Program financing once a lifetime per business.
Terms of the Financial Assistance
- Interest rate set at prime plus 2%
- Maximum repayment period of 5 years
- The first six months can be considered principal and interest free at the discretion of the Development Officer
- There is a training allowance available to a maximum of $2,000 (non-repayable)
In order to qualify for Seed Capital Program funding, ALL of the following eligibility criteria must be met.
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- Be located in St. John's - Mount Pearl area
- The loan to the applicant is to be subsequently invested as capital in a business endeavor via common or preferred stocks, shareholder's loan, or note payable in cases of limited companies or as owner's capital in case of proprietorship
- Assistance may be provided to proprietorships, partnerships, incorporated companies and cooperatives
- In case of partnership, confirm that you are majority owner in the business
- The financing must be used to assist the financing of business activities including establishment, expansion or modernization of a commercial activity, provided the principle shareholder is under the age of 35. For entrepreneurs over the age of 35, SEED funding can be used for start-up businesses only. Applicants under the age of 19 will require the co-signature of a parent or guardian
- Loan proceeds may be used to finance any costs of the business including fixed assets, start up costs and working capital. The loan is made to the individual but cannot be used for personal use
- No loan shall be made for the purchase of a licensed motor vehicle or other commercial activities inappropriate for government funding
- The purchase of a going concern is not eligible under SCP. Loan proceeds cannot be used for bail-out situations (i.e. refinancing of existing debts or a restructuring exercise)
- The proposed business must not have a negative impact on existing businesses
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