Core Business

NBCC’s core business is to provide appropriate financing solutions to small and medium business enterprises in Nunavut who require between $150,000 and $1 million in loans or guarantees.  NBCC does not offer grants or forgivable loans and cannot make equity investments.

NBCC can provide credit facilities as follows:

  • Loans to business enterprises;
  • Guarantee loans made by financial institutions to business enterprises;
  • Provide bonds to resident business enterprises; and
  • Indemnify bonds provided by bonding companies to resident business enterprises

to a maximum of $1,000,000 to any one business enterprise or to any related business enterprises.

With respect to loans to business enterprises, NBCC provides lines of credit and term loans.  Lines of credit must be renewed annually.  For term loans, the maximum term available is five years while the amortization period can be as long as twenty-five years.

Interest rates are set at the cost of borrowing plus a risk adjustment factor that can range from 0% to 5%.  The cost of borrowing is the rate that the Government of Nunavut charges NBCC for its working capital loan.  The interest rate that NBCC charges its clients is the interest rate in effect on the first day of the quarter in which NBCC’s Board of Directors approved the credit facility plus the applicable risk adjustment factor.

NBCC’s loans are structured to allow for a comfortable cash flow through such strategies as:

  • Interest only payments for up to three years;
  • Payments only to match cash rich periods of the business cycle;
  • Graduated payments;
  • Balloon payments; and
  • Suppliers’ credit.

The types of projects that NBCC considers from small and medium business enterprises include:

  • The purchase of fixed assets;
  • Leasehold improvements;
  • Consolidation of debt;
  • Bid bond security for contractors;
  • Providing working capital for inventory acquisition; and
  • Interim or bridge financing.