Indigenous Business Australia

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Indigenous Business Australia (IBA) is a government agency in Australia that supports and funds Aboriginal and Torres Strait Islander people to start, grow, and maintain their businesses.
What are the main aims and objectives?

Indigenous Business Australia (IBA) has a central purpose of fostering economic self-sufficiency and independence for Aboriginal and Torres Strait Islander people. This is achieved through three primary product streams that have been designed to aid in the creation of economic independence. Additionally, one of the key aims of IBA is to reduce economic exclusion among Indigenous Australians, empowering them through the development of financial competency and management skills. Its overall goal is to further the economic, social, and cultural development of Aboriginal and Torres Strait Islander people.

How does the program work?

Indigenous Business Australia (IBA) works by providing a range of support services and financial products to Aboriginal and Torres Strait Islander peoples. They currently run a range of initiatives including:

Start-Up Finance Package

The Start-Up Finance Package is a program aimed at supporting start-ups owned by Aboriginal and Torres Strait Islander people. The package includes a business loan of up to AUD 100,000 (approx. $64,000) with up to 30% of the loan amount awarded as a grant to purchase assets for the new business. This grant doesn't require repayment, thus helping reduce gearing levels during the start-up phase. Additionally, the package offers payment flexibility, business planning assistance, various repayment options over a maximum 7-year term, and competitive interest rates. The grant can be utilized for capital expenditure items such as plant & equipment, fit-out costs, and commercial assets. To be eligible, the start-up must be trading for less than two years, have an annual turnover of less than AUD 400,000 (approx. $250,000), and possess a commercially viable business model.

Business Loan

The Business Loan initiative is designed to assist entrepreneurs launch their business with working capital requirements, purchase of existing businesses, plant and equipment, and other commercial assets. Loans range from AUD 10,000 (approx. $6,400) to AUD 5 million (approx. $3.2 million) with terms up to 20 years. To be eligible applicants must demonstrate a viable business model.

Workshops

IBA provides a range of tailored workshops designed to aid customers at every stage of their business lifecycle. These workshops are specifically structured to help navigate the unique challenges faced by business owners during the start-up phase, as well as during the growth and expansion of their businesses. For an up-to-date list of workshops click here.

Business Support

IBA also works with startups once they have been established providing support to develop business goals, develop ideas, and provide links to other networks and resources for information and support. They also provide external business consultancy and technical support for selected businesses with high growth potential.

What is the overall cost?

IBA was initially funded with AUD 10 million (approx. $6.5 million) per year for the first four years of its existence. There is information available on the latest annual budget for IBA.

How was it implemented?

Indigenous Business Australia (IBA) has roots dating back to 1990. It was originally established as the Aboriginal and Torres Strait Islander Commercial Development Corporation (CDC). The creation of CDC was aimed at promoting Indigenous self-management and economic self-sufficiency, a goal that remains central to IBA's mission today.

The CDC was formed under the Aboriginal and Torres Strait Islander Commission (ATSIC) Act and went through several amendments to increase opportunities for Indigenous Australians in commercial development and service improvement. In 2001, the CDC underwent a significant transformation, including a name change to Indigenous Business Australia (IBA) to better represent its evolving role and mission.

One of the key strategies introduced by the IBA is the Indigenous Business Sector Strategy (IBSS), a 10-year plan developed in partnership with the Australian government. The IBSS focuses on four key pillars: providing better access to business support, improving capital access, strengthening networks, and increasing access to data.

What impact has been measured?

The IBA published an impact report in 2022 which demonstrates that each IBA’s business finance program had significant economic, social, cultural and overall impact on the community they serve. The report is based on a survey of participants in the program and reveals that:

  • 100% agreed that Indigenous employees at their business had gained new skills and knowledge
  • 86% agreed that the IBA product they used had played an important role in their business
  • 86% agreed that the program had given them a sense of pride in their indigenous culture
  • 86% agreed that IBA had better enabled them to contribute to their community
  • 81% agreed that IBA had help them grow their business

While the impact report does not provide information on the wider impact on the economy it is worth noting that since 2006 and 2018, indigenous businesses and corporations grew at around 4 per cent per year.

What lessons can be learned?

Indigenous Business Australia (IBA) has done significant work to promote and support Indigenous businesses. However, it faces challenges in measuring the impact of its work within the Indigenous context, due to the historical economic exclusion faced by these communities. Despite this, IBA has developed an Impact Framework to better understand the economic, social, and cultural impacts of their work and how these impacts generate change for Aboriginal and Torres Strait Islander people. The Impact Report has identified capacity constraints, red tape, and time delays for business solutions customers as areas that need improvement.

CURATED BY

Tom Hancock

Research Associate
Global Entrepreneurship Network
United Kingdom