Small and Medium Enterprise Fund

The Small and Medium Enterprise Fund provides term loans and equity investments to small and medium-sized businesses in strategic growth sectors with special emphasis on value-added manufacturing, information technology, aquaculture, bio-technology, marine services, agrifoods and tourism, where local competitive impact is not an issue. The fund will also target businesses which have export potential and need assistance to enter or expand in external markets.

Funds are provided to complement funding from conventional sources where a need has been demonstrated. The funding is also intended to increase the capital base of businesses allowing them to lever new private-sector investments.

Eligibility Criteria

Loan applications may be considered from a proprietor, partnership, corporation, co-operative or non-profit commercial organization operating within the province.  All types of business and sectors are eligible, except real estate services, retail, service and wholesale operations, beverage rooms and taverns. The business applying must demonstrate:

• leveraged funding including client commitment;
• market potential;
• strong experienced management;
• net economic benefit / job creation; 
• the potential for viability, sustainability and growth;
• that it is unable to obtain sufficient funding under reasonable terms and conditions from conventional sources; and
• that the funding support is essential to the success of the business.

Summary

Available Funding
Term Loan: Up to $250,000 total funding is available per applicant and affiliated / associated companies at Department's base rate plus 3% interest with a minimum applicant investment of 20% of project costs.

Equity Loan: Up to $50,000 per year; maximum $100,000 in the aggregate per applicant and affiliated / associated companies at 5% interest provided on a matching basis with "new" capital investment in the form of cash or equivalent equity.

A business plan is required to support all funding requests.

Eligible Activities 
Loans may be used for start-up, modernization, or expansion of a business venture and may include:

• purchase of fixed assets including land, building, and equipment, excluding on-road vehicles, snowmobiles and ATV's;
• construction and/or expansion or renovation of building(s) including leasehold improvements; 
• working capital for growth; and
• the purchase of  intangible assets where such assets form an integral part of a business venture (e.g. patents, technology rights).

Ineligible Activities  
Funds cannot be used:

• to retire existing applicants’ / shareholders’ investment;
• for debt consolidation, refinancing or purchase of existing operations;
• to assist a business to gain market share from other local companies; and / or
• result in a local market becoming further fragmented.

For information and assistance:

• call toll-free at 1-800-563-2299
• visit the Department's web site
• visit the regional office nearest you:  INTRD - Contacts for Newfoundland and Labrador.