Small businesses are the backbone of our economy but they continue to face economic challenges and uncertainty during the COVID-19 pandemic.
Deputy Prime Minister Chrystia Freeland recently announced that the application deadline for the Canada Emergency Business Account (CEBA) is extended from August 31 to October 31, 2020.
“Small businesses can count on the federal government to stand with them during this pandemic,” Freeland said. “By making CEBA loans available for an additional two months, we will help more small businesses get into a better position to weather the storm and get back on their feet. Extending BCAP will improve access to the capital needed by businesses to pay workers’ salaries and cover expenses — and it will also serve as a bridge until we return to more normal borrowing conditions. The federal government is actively considering what further measures are needed as we continue with a safe reopening of the economy.”
The government is working closely with financial institutions to make the CEBA program available to those with qualifying payroll or non-deferrable expenses that have so far been unable to apply due to not operating from a business banking account.
Further details on these changes will be released in coming days, including a new business account opening process through which qualifying businesses will be able to apply.
Freeland also announced that the Business Credit Availability Program (BCAP) is extended to June 2021. Through BCAP, the government is supporting the flow of additional credit that businesses need to maintain operations and keep employees on the payroll. Export Development Canada (EDC) and the Business Development Bank of Canada (BDC) will continue to work with lenders to support access to capital for Canadian businesses of all sizes in all sectors and regions.
CEBA and BCAP are both part of the Government of Canada’s COVID-19 Economic Response Plan, which is helping Canadians and businesses deal with the economic impact of the ongoing pandemic. The measures under this plan are helping businesses protect the jobs that Canadians depend on, keep their doors open, and bounce back as the economy gradually recovers.
“For Canada to truly lead in a post-COVID world, supporting small businesses is critical,” said Mary Ng, Minister of Small Business, Export Promotion and International Trade. “This is why our government continues to take bold and comprehensive action to do just that. By extending the Canada Emergency Business Account through to the end of October, we are taking the necessary steps to ensure that small businesses will be able to access the liquidity they need to keep operating while times are still tough, so they will be able to rebuild on the road to economic recovery.”
Launched on April 9, 2020, CEBA provides interest-free loans of up to $40,000 to small businesses and not-for-profits, to help cover their operating costs—such as rent, utilities and insurance—during a period where their revenues have been temporarily reduced. These loans are partially forgivable as repaying the balance of the loan on or before December 31, 2022 will result in loan forgiveness of 25 percent (up to $10,000).
To apply for CEBA or to learn more about the program, businesses can contact their primary financial institution. Information can also be found on the program’s website.
Photo: “For Canada to truly lead in a post-COVID world, supporting small businesses is critical,” said Mary Ng, Minister of Small Business, Export Promotion and International Trade.