Small Business Assistance
This program is designed to meet the special needs of Prince Edward Island's small business community and entrepreneurs for the following purposes:
- purchase and/or acquisition of business
- new construction
It does not provide working capital for the small business sector.
The repayment period must coincide with the expected life of the asset being financed, but in no case will it exceed 20 years. These loans may be used for buying machinery, equipment, real property and buildings or other purchases of a capital nature. Vehicles that do not directly contribute to the business’s income or sales are not eligible.
Small business includes any person that:
- carries on business, or intends to carry on business, in the province;
- purchases a finished product from a supplier and resells that product without alteration;
- does not employ more than 100 people; or
- did not have annual gross sales exceeding $10 million in the fiscal year immediately after an application made following section 9 of the Act. defined as:
- The loan does not provide working capital for operating purposes.
- Loans for the development or construction of retail malls may only be considered, if the borrower maintains a presence in the mall as owner/operator of one of the retail outlets. That business must also be a major tenant of the proposed mall.
- Franchised operations are eligible to borrow from Finance PEI, under this sector, for their capital asset components. The non-capital assets (i.e. goodwill, franchise fee) are not eligible for financing.
Intermediate term loan
The repayment term should coincide with the expected life of the asset being financed, but loans will not exceed 10 years. These loans may be used for the purchase of machinery, equipment or other acquisitions of a capital nature. Vehicles which do not directly contribute to the business’s income and sales are not eligible.
Long term loan
Capital loans are available for the purchase and/or refurbishment of capital assets and, in some cases, for debt restructuring. The maximum term for a loan is 20 years and has flexible repayment options, matching your business’s cash flow. Loans are typically secured by a lien on the property, but in some cases alternate security may be considered. The loan limit will not generally exceed 80 per cent of the fair market value or purchase price, whichever is less.