The amendments to the Canada Small Business Financing Regulations and Canada Small Business Financing Act came into force on July 4, 2022. They provide lenders and small businesses with additional financing products, new class of loans, increased loan amounts and terms, improved loan conditions and decreased administrative burden. Financial institutions are currently in the process of rolling out these changes to start offering all of the enhanced features shortly.
The Canada Small Business Financing Program makes it easier for small businesses to get loans from financial institutions by sharing the risk with lenders.
Term loans can be used to finance the following costs:
- purchase or improvement of land or buildings used for commercial purposes
- purchase or improvement of new or used equipment
- purchase of new or existing leasehold improvements, that is, renovations to a leased property by a tenant
- intangible assets and working capital costs
Lines of credit can be used to pay for working capital costs, that is, day-to-day operating expenses of the business.
The maximum loan amount for any one borrower is $1.15 million.
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