Decarbonization and tackling air pollution are at the forefront of Canada’s agenda as the country strives to meet its goals. commitment achieve net zero emissions by 2050. In an effort to diversify this movement, the Federation of African Canadian Economics (FACE) is administering the $160 million budget Black Entrepreneurship Loan Fund. Under the macro loan program, eligible Black-owned businesses can apply for up to $250,000 for capital investments, including clean transportation vehicles and fueling and charging equipment. Working capital and short-term receivable financing loans are also available.
FACE works with the Government of Canada, the Crown corporation, the Business Development Bank of Canada, and financial institutions such as credit unions to provide these loans. This program is cross-sectoral with public-private partnerships at the heart of FACE’s work.
Pro-funding for Black entrepreneurs in Canada couldn’t be more timely given the clean transportation and energy revolution the country is experiencing. Budget 2023 announcement five key tax credits for clean investments totaling more than $60 billion over the coming decade. Energy Minister Jonathan Wilkinson announcement Canada’s carbon management strategy, late September, presented by the International Energy Agency in Paris, France.
FACE adds to this set of financing programs and policies and offers Black-led businesses in Canada flexible loan terms, allowing eligible entities to defer principal payments for up to 12 months with a loan term of up to 12 months. up to seven years. The program will charge interest for up to 12 months, while fees, rates and terms are subject to the borrower’s credit score.
Clean transportation players looking to improve their value chain through inclusive supplier diversity initiatives may see this opportunity as a boon to their efforts. Michigan State University recently reported on the profound financial benefits for companies that invest in minority-led businesses. Large Canadian companies can work with Black-owned businesses to apply for this program.
Diverse and inclusive funding is essential as Black Canadians face considerable barriers in the entrepreneurial ecosystem: 75% of Black entrepreneurs believe their race has made success as an entrepreneur more elusive, by the African-Canadian Senatorial Group. Statistics Canada reports this average investment in white-owned businesses is more than three times that of black businesses in terms of physical capital.
The stark differences along racial lines make the FACE loan program essential within Canada’s clean energy innovation movement. Fairer lending will enable the best and brightest entrepreneurs to contribute to the country’s decarbonization goals.
Expanding access to capital through an inclusive approach is crucial as the clean energy revolution unfolds in real time from coast to coast and country to country. Investments, technology and public policies are accelerating Canada’s transition to sustainable energy and transportation. Canada is clear in its intention to finance new companies that fight climate change. Black-led businesses focused on clean technology, sustainability and decarbonization should contact the FACE support team.
Could your business, agency or organization need help navigating the incentives, regulations and policies that apply to your fleet due to these new policies?
GNA, North America’s leading clean transportation and energy consulting firm, is here to help. Contact us if you would like to strategize around environmental justice and clean transportation. Here’s to a season full of transformative investments in clean – and humane – transportation.