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Business Growth: Nickel Basin Federal Development Corporation

The Nickel Basin Federal Development Corporation provides financial support for small and medium-sized businesses.
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Nickel Basin Federal Development Corporation is a Sudbury-based not-for-profit organization with a mandate to provide financial support for small and medium-sized businesses as a means to promote economic growth and local diversification.

The organization administers a community loan fund with a lending limit of up to $250,000 and up to $600,000 on syndicated loans.

Funded through Industry Canada and FedNor, Nickel Basin supports business innovation and expansion, works in partnership with other institutional lenders and government agencies on financing arrangements, and identifies employment challenges and opportunities suitable for support by government programs.

With a regional coverage area that includes the City of Greater Sudbury and some outlying areas, the organization has authorized loans totalling more than $40 million and maintained or created close to 5,000 full and part-time jobs since its inception in 2000.

Nickel Basin often works with startup businesses which typically struggle to obtain financing from mainstream lenders.

The corporation extends financing using three financial instruments:

  • commercial term loans: the most common form of financing with repayment terms of five to 18 years, depending on the project;
  • revolving credit facility: an operating facility used for inventory purchases and account receivable financing; and
  • equity financing: an injection of capital in return for preferred shares of the company. This form of financing is only considered in very specific circumstances, and is rarely used for startups.

All loans are repayable on agreed terms. These are not forgivable loans. As with other conventional lenders, financial information is required.

To qualify, program applicants must be located within the corporation’s defined geographical boundaries, the funds must be earmarked for creating jobs or keeping existing jobs, the applicant must make a personal investment of at least 10 per cent, the applicant must be a viable business with the ability to repay the loan, must have a competent management team in place, and must possess appropriate security and acceptable credit records for the business.

Working in tandem with the City of Greater Sudbury’s Regional Business Centre, the corporation will assist with market and feasibility studies; administrative evaluations; assistance in obtaining other forms of funding; business proposals and business plans.

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