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Small Business > Borrowing and Credit > Specialized Financing Options > Government Sponsored Programs

Canadian Agricultural Loans Act (CALA)

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This federal government program which has replaced the Farm Improvement and Marketing Cooperatives Loans Act allows you to grow, diversify and expand your farming business. It is designed to finance farm improvements and fund the processing, distribution and marketing of farm products.

How can this help my business?

  • Individual farmers can receive up to 80% financing (beginning farmers up to 90% financing) to a maximum of $500,000 for real property assets or up to $350,000 for all other eligible assets
  • The program supports inter-generational farm transfers with loans up to $500,000
  • Farm products marketing co-operatives can apply for financing up to $3 million
  • Eligible assets include land, buildings, construction, machinery, livestock, consolidation/refinancing, share purchases and crop storage condominiums
  • Maximum interest rate on variable rate loans is Prime+1%, fixed rate loans is Residential Mortgage Rate+1%
  • Loan terms are up to 10 years (15 years for land) and flexible payments available (monthly, quarterly, semi-annually, annually)

What else do I need to know?

  • The program is available to full-time or part-time farmers who are either currently farming or intend to be farming in Canada
  • Farm products marketing co-operatives are eligible under the program provided at least 50% + 1 of the members are farmers
  • There is a one-time, up-front government registration fee of 0.85% of the loan amount
  • There is an RBC administration fee of the lesser of 0.25% of the CALA loan amount or $250. (0.1% if loan exceeds $250,000)
  • Business Loan Insurance Plan is available (certain conditions may apply)
 

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