Access to capital is vital for starting or expanding a new business, or for purchasing an existing business. Small businesses are especially important to the growth of Manitoba's rural communities, and MASC is committed to providing rural entrepreneurs with the opportunity to access credit with reasonable interest rates and terms.
MASC's Rural Entrepreneur Assistance (REA) program provides extra security to financial institutions that are prepared to offer businesses (small commercial and home-based) in rural Manitoba the financial support they need to be successful.
Factsheet: REA/RSB Loan Guarantees
MASC also guarantees loans to existing businesses and entrepreneurs in rural Manitoba (outside Winnipeg).
MASC can guarantee loans made to owners/operators, and may be used to finance the purchase of fixed assets, inventory and/or working capital. This includes start-up of a new business, expansion or modernization of an existing business, or purchase of an existing business.
Funds cannot be used to pay existing debts of the company or any individual, nor are REA loans transferable to other persons, companies or businesses.
Rural Entrepreneur Assistance is available to small businesses located in Manitoba, outside of Winnipeg, with $2 million or less in annual income/sales.
Applicants must contribute 20% of the total costs as equity (in the form of cash, land, buildings, equipment, inventory and/or other assets).
Businesses not eligible include (but are not limited to): insurance, real estate investing, financial, restaurants, those engaged in primary harvesting of resources, primary agriculture or those intending only to renovate or make cosmetic changes to buildings.
REA guarantees are available on loans over $10,000, and are capped at 80% of the first $200,000 borrowed. When the total loan amount exceeds $200,000, the guarantee is calculated as a percentage of the loan.
For a loan to qualify for a REA guarantee, the interest rate charged by the lender cannot exceed the lender's commercial prime rate plus 2.5%. If a fixed rate is preferred, the rate is negotiated with the borrower and lender.
Loan repayment terms are negotiated between the lender and borrower. Loan amortizations beyond 10 years are permitted, however tthe REA guarantee is restricted to the first 10 years (maximum).
An application form must be completed and submitted along with a business plan to the lender.
Application: Rural Entrepreneur Assistance
If filled out completely, Part 2 of the REA application will satisfy the business plan requirement.