Canadian Agricultural Loans Act program
The Canadian Agricultural Loans Act (CALA) program is a financial loan guarantee program that gives farmers easier access to credit. Farmers can use these loans to establish, improve, and develop farms; while Agricultural co-operatives may also access loans to process, distribute, or market the products of farming.
The CALA program builds on and replaces the previous Farm Improvement and Marketing Co-operative Loans Act (FIMCLA) program, which has helped farming operations grow their businesses by guaranteeing loans issued through financial institutions since 1988.
Through the CALA, the Government of Canada is supporting the renewal of the agricultural sector and enabling co-operatives to better seize market opportunities.
The Canadian Agricultural Loans Act (CALA) program is a financial loan guarantee program that gives farmers easier access to credit.
Under the CALA, the federal government guarantees repayment of 95% of the loan to the lender, provided that the requirements of the Act and the Regulations have been respected.
Maximum Loan Amounts
Loans are limited to a maximum of:
- $500,000 for land and the construction or improvement of buildings.
- $350,000 for all other loan purposes.
The maximum aggregate loan limit for any one borrower is $500,000.
The maximum aggregate loan limit for agricultural co-operatives is $3 million, with the Minister's approval.
The maximum amount eligible for consolidation/refinancing is the total of the outstanding principal balances of the loans to be consolidated/refinanced, to a maximum of $350,000.
For example: If a farmer gets a CALA loan for $300,000 for a tractor, he can still access up to $200,000 for land purchase or building repair, or $50,000 for another implement and $150,000 for land purchase or building repair.
On behalf of AAFC, participating financial institutions administer loans under the CALA.
Lenders can now register loans online using the new Online Registration System.
In the summer of 2012, the functionality to transfer/receive registration fees/refunds electronically will be added as a feature in this secure web-based system available for lenders.