Summary of the Survey on Financing and Growth of Small and Medium Enterprises, 2020

PDF Version


The 2020 Survey on Financing and Growth of Small and Medium Enterprises was designed to determine the types of financing used by small and medium-sized enterprises (SMEs), and to collect information on recent attempts by SMEs to obtain new financing. In addition, the survey gathers data on SMEs' growth, on activities related to growth, and on business owner characteristics.

The 2020 survey questionnaire was adapted from questionnaires used for previous iterations of the Survey on Financing and Growth of Small and Medium Enterprises (2011, 2014 and 2017), and from questionnaires used for the Survey on Financing of Small and Medium Enterprises (2000, 2004 and 2007).

Key results from the 2020 Survey on Financing and Growth of Small and Medium Enterprises are described below. The data tables provide detailed statistics disaggregated by firm characteristics, such as business size, industry and innovation status, as well as owner and primary decision maker characteristics, such as gender and education.

The 2020 tables introduce a wide range of new statistics. Some of the impacts of the COVID-19 pandemic on SMEs are captured with statistics on the length of temporary business closures and on SMEs that received funding through the Canada Emergency Business Account.Footnote 1 The tables also offer new information on the Advanced Technology and Advanced Manufacturing sectors, advanced technology adoption, visible minority types, social enterprises and sole proprietorship status. In addition, new cross-tabulations are presented, including for SMEs that used e-commerce, undertook international business activities or had expansion intentions.

Summary of results

COVID-19 pandemic

In March 2020, government interventions related to the COVID-19 pandemic were implemented across Canada, significantly impacting all businesses including SMEs. As a result, 33 percent of SMEs closed temporarily over the course of the year, for an average of 12 weeks. Smaller firms, in public facing industries such as the Accommodation and food services and Other services sectors, were more likely to close temporarily due to the pandemic.

Significant government support, such as the Canada Emergency Business Account (CEBA) and the Canada Emergency Wage Subsidy (CEWS), was made available to businesses throughout 2020.Footnote 2 Over three-quarters of SMEs applied for at least one type of government financingFootnote 3, such as CEBA and CEWS, with an approval rate of 98 percent. Most SMEs that applied for government financing applied for CEBA (86 percent of SMEs) or CEWS (59 percent).Footnote 4

Financing characteristics

In 2020, 82 percent of SMEs requested external financing. Seventy six percent of all SMEs requested government financing, 24 percent requested trade credit, 16 percent requested debt financing, 6 percent requested lease financing, and 1 percent requested equity financing.Footnote 5

These results contrast with previous survey iterations, wherein roughly 50 percent or less of SMEs requested external financing, debt financing was the most common or second-most common type of external financing requested and no more than 6 percent of SMEs requested government financing. The differences between the 2020 survey results and the results of previous survey iterations underline the magnitude of the impacts of the COVID-19 pandemic on SMEs.Footnote 6

In 2020, of the 18 percent SMEs that did not request financing, 87 percent did not require financing.

Four percent of SMEs not requesting financing were unaware of financing sources available to the business, 3 percent were discouraged borrowers (i.e. believed their request would be turned down), 1 percent not requesting financing considered applying for financing to be too difficult or time consuming and 1 percent thought financing would be too costly.Footnote 7

With an approval rate of 98 percent, nearly all SMEs that requested government financing had their requests approved, regardless of their size (Table 1). The smallest SMEs (1 to 4 employees) and the largest SMEs (100 to 499 employees) were less likely to request government financing. The average amount of government financing provided increased with firm size.

Table 1: Government financing request and approval rates by size of business, 2020

  Request rate
Approval rate
Average amount of financing provided
All SMEs 75.9 98.2 69,614
Size of business
(number of employees)
68.5 97.7 46,262
86.4 98.7 53,469
84.6 98.7 138,309
75.0 97.7 648,798

The results for government financing contrast with requests for other types of financing, such as debt financing, which are more often sought by and approved for larger firms.

Owner characteristics

In 2020, most SMEs were male-owned: 69 percent were majority male-owned, 17 percent were majority female-owned and 14 percent were owned equally by men and women, with the latter figure lower than observed in previous survey iterations.Footnote 8

Members of the same family, visible minorities, Indigenous persons and person(s) with a disability, respectively, held the majority ownership of 34 percent, 9 percent, 1 percent and 1 percent of SMEs.

The primary decision makersFootnote 9 of SMEs tended to be older, with 62 percent 50 years of age or older; to be well-established in Canada, with 71 percent born in Canada and the remaining 29 percent, who were born outside of Canada, having resided in Canada for an average of 27 years; to be experienced, with 75 percent having 10 or more years of management or ownership experience; and, to be well-educated, with 70 percent having attained a post-secondary diploma or degree.

Sales destinations

In 2020, 12 percent of SMEs exported, of which 38 percent exported goods only, 45 percent exported services only and 18 percent exported both goods and services.

Eighty-four percent of SME exporters sold to the United States, 19 percent to European countries (excluding the United Kingdom), 15 percent to the United Kingdom, 12 percent to China, 10 percent to Asian countries (excluding China, India and Japan), 7 percent to Latin American countries (excluding Mexico and Brazil), 6 percent to Mexico, 5 percent to Japan and 4 percent to India.Footnote 10 Of the 88 percent of SMEs that did not export, 87 percent did not export because of the local nature of their businesses.

No single issue (e.g. administrative, border, logistical, market knowledge, intellectual property and financial issues) was considered by more than 14 percent of exporting SMEs to be a major obstacle to selling abroad. However, the proportion of SMEs reporting border obstacles and logistical obstacles to be major obstacles to exporting was elevated relative to previous years.Footnote 11

Many SMEs sold beyond their local markets, with 49 percent selling outside of their municipality/region and 22 percent selling to other provinces or territories (Table 2). Larger SMEs were more likely to sell beyond their local markets and export. Likewise, larger SMEs had a higher proportion of sales outside their local area than did smaller SMEs.

Table 2: Sales destinations by size of business, 2020

  Within local municipality or region Outside of local municipality or region but within province/territory Rest of Canada Outside Canada (export sales)
Propensity (percentage of businesses)
All SMEs 90.9 49.4 21.6 12.1
Size of business
(number of employees)
89.0 44.3 18.2 10.7
94.4 54.4 23.2 11.7
91.5 59.4 30.2 17.0
85.3 62.7 48.4 36.1

Growth characteristics

Sixty-two percent of SMEs reported positive average yearly growth in sales or revenues between 2018 and 2020. In particular, the sales of 30 percent, 15 percent, 7 percent, 3 percent and 7 percent of SMEs grew by 1 percent to 5 percent, 6 percent to 10 percent, 11 percent to 15 percent, 16 percent to 19 percent and 20 percent or more, respectively. The sales of 18 percent SMEs did not grow, while sales declined for 21 percent of firms.Footnote 12

The proportion of SMEs reporting negative sales growth was elevated relative to previous survey iterations, while the proportions reporting no growth or positive growth were lower.Footnote 13

In 2020, the most common obstacles to growth were the rising costs of inputs (31 percent of SMEs), recruiting and retaining skilled employees (28 percent) and a shortage of labour (25 percent). Other major obstacles of growth included fluctuations in consumer demand (23 percent of SMEs), corporate tax rate (18 percent), maintaining sufficient cash flow or managing debt (18 percent), government regulations (17 percent). Ten percent of SMEs considered obtaining financing to be a major obstacle to their growth.

Innovation activity, intellectual property and advanced technology adoption

Twenty-eight percent of SMEs introduced at least one type of innovation between 2018 and 2020 (Table 3). Sixteen percent introduced a product innovation, 9 percent a marketing innovation, 9 percent an organizational innovation and 8 percent a process innovation.

Sixteen percent of SMEs held intellectual property. Ten percent were party to non-disclosure agreementsFootnote 14, the most commonly held intellectual property.  Seven percent of SMEs held registered trademarks, 2 percent trade secrets, 1 percent patents and 1 percent industrial designs.

The proportion of SMEs introducing innovations and the proportion of SMEs holding intellectual property were lower in 2020 relative to previous survey iterations, for firms of all sizes.Footnote 15

Thirty-four percent of SMEs adopted at least one type of advanced technology between 2018 and 2020. Fourteen percent adopted business intelligence technologies, 11 percent security or advanced authentication systems, 8 percent material handling, supply chain or logistics technologies, 8 percent design or information control technologies, 7 percent internet of things systems, 5 percent clean technologies and 4 percent processing or fabrication technologies.Footnote 16 Fifty-nine percent of SMEs had an online presence in 2020, most commonly a website (83 percent) or social media account (66 percent).Footnote 17

Larger SMEs were more likely than smaller SMEs to innovate, hold intellectual property and adopt advanced technology.

Table 3: Innovation, intellectual property holdings and advanced technology adoption, by size of business, 2020


  Introduced at least one type of innovation
(2018 to 2020)
Held at least one type of intellectual property
(as of December 2020)
Adopted at least one advanced technology
(2018 to 2020)
All SMEs 28.4 15.5 33.7
Size of business
(number of employees)
22.7 10.8 27.6
33.5 17.1 37.6
44.4 33.4 49.8
47.0 54.1 64.1


The target population for the survey was private sector, for-profit, SMEs employing between 1 and 499 people and generating over $30,000 in annual revenues in 2020. The 2020 survey was conducted using a new type of survey collection, Electronic Questionnaire; previous iterations were conducted by Computer-Assisted Telephone Interview. The target base population of over 859,000 SMEs was stratified by geography, employment and industry, with random samples selected from these strata in order to generate representative estimates. The survey was conducted by Statistics Canada from April to August 2021. The base sample size was 19,283 SMEs. For the main population, the response rate was computed as 56 percent.


For more information, or to enquire about the concepts, methods or data quality of the survey results, contact Statistics Canada (toll-free 1-800-263-1136;

For additional information on related research topics and data sets, consult the SME Research and Statistics website or contact Lyming Huang or Patrice Rivard at the Small Business Branch.


The Small Business Branch would like to thank our many partners for their contributions. In particular, we are grateful to the Centre for Special Business Projects Team at Statistics Canada for their role in developing and conducting the survey, and for survey funding from and collaboration with our Innovation, Science and Economic Development Canada partners Automotive, Transportation and Digital Technologies Branch, Canada Small Business Financing Program, Canadian Intellectual Property Office, Co-operatives Policy Unit and Tourism Branch, as well as from our external partners Atlantic Canada Opportunities Agency, Business Development Bank of Canada, Global Affairs Canada, Export Development Canada, Employment and Social Development Canada, Federal Economic Development Agency for Northern Ontario, Institut de la statistique du Québec, Ontario Ministry of Economic Development, Job Creation and Trade, and Public Services and Procurement Canada.