No land? No loan. Why it can be hard to borrow money from a bank if you live on reserve

LouAnn Solway's love of ranching runs deep. She grew up on Siksika First Nation, about 100 kilometres east of Calgary, and learned how to care for cattle from her father and grandfather.

"I was always supposed to be around cattle, feeding them, watering them and fixin' fences and, you know, making sure all the babies were born," she said in an interview with CBC Radio's Cost of Living.

Solway learned not only about cows, but also horses — used in herding and managing the cattle — and how to be frugal when it comes to animal care. "It was a lot of being creative and self-sustaining."

Solway started off with about 10 head of cattle, inherited from her dad. When she wanted to expand her business, she approached several banks, looking for a loan of between $150,000 and $200,000 — and they all turned her down.

"They all came up with the same thing … you know, 'Sorry,'" Solway said.

The problem she, like many others in similar situations, had run up against was this: First Nations people living on reserve don't legally own the land they live on, as specified by the Indian Act.

Solway's ranch is on the Siksika Nation's reserve. The land is owned by the Crown, and under federal regulations, the bank can't seize it — or the cattle — in the event of a loan default.

To the banks, "it wasn't good collateral," she said, of her land and cattle. "And a lot of times, it was they didn't have a special program in their banks that served Indigenous projects like mine."

Solway said she found it particularly discouraging, because growing up, she often heard non-Indigenous ranching classmates talk about their families going to the bank and getting loans easily.

"And I couldn't see where I was different. Hell, I still pay the way they pay," she said. "But I had to go to a separate entity that's not even a bank."

Solway eventually got a loan through the Calgary-based Indian Business Corporation, an Aboriginal Financial Institution (AFI) that is Indigenous-run and community-based.

That struggle to secure financing is one that Shannin Metatawabin knows well. 

Metatawabin, who is CEO of the National Aboriginal Capital Corporations Association (NACCA), which represents AFIs across Canada, says the problem has deep roots.

"[Colonial powers] basically removed us, gave us an Indian Act that required that we are wards of the state. So we don't even retain any ownership of any land whatsoever," he said.