Credit Conditions Survey

The Credit Conditions Survey was conducted between January and March of 2017. The questions were fact-based and focused on financing sought by small enterprises (1 to 99 employees) during the 2016 calendar year.

A total of 2,111 small businesses completed the questionnaire, which included 24 questions. This is the second largest Canadian survey on small business financing. The margin of error is 2.1% for questions addressed to all respondents. R.A. Malatest & Associates administratered the survey for Innovation, Science and Economic Development Canada.

The following tables present the key statistics from this survey.

Table 1: Request Rates, Approval Rates and Average Amounts Authorized, 2016
Type of Financing	Request Rate	Approval Rate^{Footnote *}	Average Amount Authorized
Debt Financing	26	82	$270,000
Leasing	9	94	-
Equity Financing	3	-	-
Trade Credit	7	-	-

Table 2: Debt Financing (Long Term versus Short Term), 2016
Type of Debt	Request Rate	Approval Rate^{Footnote *}	Average Interest Rate	% Collateral Required	Average Amount Authorized
Long Term^{Footnote 1}	12	84	4.9	84	$480,000
Short Term^{Footnote 2}	21	82	5.5	59	$200,000
Overall	26	82	5.3	63	$270,000

Table 3: Debt Financing By Enterprise Characteristics, 2016
Enterprise Characteristics	Request Rate	Approval Rate^{Footnote *}	Average Amount Authorized	Total Amount authorized-to-requested ratio
Number of Employees
1 to 4 employees	23	82	$150,000	85
5 to 9 employees	23	76	$170,000	68
10 to 19 employees	32	83	$470,000	90
20 to 99 employees	39	92	$450,000	99
Region
Atlantic	26	80	$150,000	66
Quebec	28	80	$420,000	95
Ontario	23	85	$340,000	83
Manitoba-Saskatchewan	25	81	$120,000	89
Alberta	31	78	$190,000	82
British Columbia & Territories	25	86	$110,000	85
Industry
Accommodation and Food	26	80	$140,000	82
Construction	35	87	$110,000	79
Manufacturing	26	85	$290,000	84
Agriculture and Fishing, Forestry, and Oil and Mining	29	81	$500,000	88
Professional Services	24	84	$78,000	68
Transportation/Warehousing	30	89	$140,000	93
Retail and Wholesale	29	81	$240,000	86
Age of Business
3 years old or younger	35	86	$220,000	77
4 to 10 years old	31	74	$160,000	84
More than 10 years old	24	81	$270,000	87
Exporting Activities
Exporter	28	78	$300,000	88
Non-exporter	26	83	$270,000	87
Innovation
Product	34	79	$160,000	81
Process	37	81	$250,000	84
Organizational	44	76	$530,000	92
Marketing	36	81	$190,000	84
Innovator^{Footnote **}	34	82	$300,000	88
Non-innovator	19	83	$220,000	82
Gender of Majority Owner
Male	25	83	$310,000	89
Female	28	85	$180,000	93
Jointly Owned	32	75	$82,000	40
Education Level of Majority Owner
Less than high school	28	88	$260,000	87
High school diploma	27	83	$160,000	79
College/Cegep/Trade school diploma	27	82	$170,000	85
Bachelor Degree	25	81	$570,000	93
Masters Degree or above	24	78	$210,000	70
Experience Level of Majority Owner
< 5 years	37	85	$180,000	90
5 to 10 years	29	78	$330,000	93
> 10 years	25	83	$260,000	84
Age of Majority Owner
Younger than 40 years old	24	89	$210,000	90
40 to 49 years old	31	83	$250,000	92
50 to 64 years old	28	80	$280,000	82
65 years old or older	12	84	$300,000	87

Table 4: Main Reason for Not Seeking Financing, 2016
Reason	%
Financing not needed	85
Unaware of financing sources	3
Thought the request would be turned down	4
Applying for financing too difficult or time consuming	4
Cost of financing too high	2
Other reason	3

Table 5: Main Intended Use of Debt Financing, 2016
Intended Use	%
Fixed asset	32
Working/Operating capital	49
Research and development	2
Debt consolidation	7
Enter a new market	4
Other use	6

Table 6: Sale Destinations, 2016
Destination	%
Local municipality or region	76
Rest of province/territory	15
Rest of Canada	5
Rest of the world	4

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Credit Conditions Survey - 2016