The worst thing about the Alberta economy is the uncertainty of the situation. No one knows when the oil sector will recover and what it will look like when it does. Housing prices are dropping and families are burning through their cash reserves. 2016 will be harder than 2015.

But it’s in adversity that opportunity is often found. Tough economic conditions in Alberta are shaping a successful model for social finance and impact investment while opening new and innovative possibilities for First Nations entrepreneurs to flourish. As Wanda Wilson, a First Nations finance specialist puts it: “First Nations entrepreneurs always have their backs against the wall when it comes to accessing capital. Moving past these challenges builds exceptionally resilient companies. In 2008 we saw how First Nations contractors were nimble enough to take work from bigger, more costly operators. We expect to see this again as we emerge from the current crisis.”

Download Alberta's economy is the mother of invention

This is where developmental lending begins to resonate. With over 25 years of experience, Aboriginal Financial Institutions (AFIs) have demonstrated in good times and bad how developmental lending can yield social and financial returns through an uncomplicated approach: making loans to First Nations people who can’t get one at a bank or credit union. By closing the ‘access to capital gap’ faced by Aboriginal businesses, Canada’s AFI network can offer steady deal flow to an impact investment community seeking more opportunities to make social impact.

Table of Contents

Executive Summary
These are challenging times
What’s the risk of eliminating all risk?
The problem with social finance
Social finance grows outside the centre of power
Mad cow and other market forces
Simple innovation
The difference between developmental and commercial lending
Government enables social finance
Leadership from AFIs & Community Foundations
Conclusion

Source: Indian Business Corporation