Canada Small Business Financing Program (CSBFP)
The Canada Small Business Financing Program makes it easier for small businesses to get loans from financial institutions by sharing the risk with lenders.
The enhanced program provides lenders and small businesses with additional financing products, new class of loans, increased loan amounts and terms, improved loan conditions and decreased administrative burden.
Offered by Innovation, Science and Economic Development Canada (ISED) and financial institutions
Amount
Maximum loan amount of $1.15 million per borrower: up to $1,000,000 for term loans (no more than $500,000 for leasehold improvements and equipment, of which a maximum of $150,000 for intangible assets and working capital costs) and up to $150,000 for lines of credit
Quick eligibility check
Who can apply
- What businesses are eligible to apply under the Canada Small Business Financing Program (CSBFP)?
Most start-ups and existing for-profit, not-for-profit and charitable small businesses in Canada with gross revenues of $10 million or less are eligible to apply for loans under this program. Such businesses can be corporations, sole proprietors, partnerships or cooperatives.
Not eligible:
Not eligible under this program: farming businesses (for a similar program for the farming industry, visit the Canadian Agricultural Loans Act Program
About the funding
The maximum loan amount for a borrower is $1.15 million.
- Up to a maximum of $1,000,000 for term loans for any one borrower, of which no more than $500,000 can be used for purchasing leasehold improvements and purchasing or improving new or used equipment and of that amount, a maximum of $150,000 could be used for intangible assets and working capital costs.
- Up to a maximum of $150,000 for lines of credit.
- How much can be financed and what is the maximum loan amount I can access under this program?
Show all funding details
It is up to the borrower and lender to negotiate an appropriate amount of financing.
Interest rates
For term loans, the interest rates are determined by your financial institution and may be floating or fixed.
- Floating: The maximum chargeable is the lender's prime lending rate plus 3%.
- Fixed: The maximum chargeable is the lender's single family residential mortgage rate for the term of the loan plus 3%.
For lines of credit, the maximum chargeable is the lender's prime lending rate plus 5%.
Registration fee
For term loans, the 2% registration fee is based on the total amount loaned under the program.
For lines of credit, the 2% registration fee is based on the total amount authorized.
Registration fees must be paid by the borrower to the lender and they may be financed.
Financing terms
Lenders have the option to take an unsecured personal guarantee.
For real property and equipment, security must be taken on the assets financed. For leasehold improvements, software, intangible assets, working capital costs and when financing a line of credit, the lender must take security on any business assets.
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, i.e., renovations to a leased property by a tenant
- intangible assets and working capital costs
For example, you can use a term loan to finance:
- commercial vehicles
- hotel or restaurant equipment
- computer or telecommunications equipment and software
- production equipment
- costs to buy a franchise
Lines of credit can be used to pay for working capital costs, that is, day-to-day operating expenses of the business.
- Can I purchase an existing business under the CSBFP?
The purchase of eligible assets of an existing business may qualify for financing under the CSBFP. You may finance the lesser of the cost of purchase and the appraised value of the eligible assets. Please contact your financial institution before committing to appraisal expenses to ensure all other requirements are met.
Similar programs
| Program | Type | Amount | Status |
|---|---|---|---|
| FCC Financing Food and Beverage | Loan | No fixed amount | Open |
| BDC Commercial real estate loan | Loan | Typically starts at $100,000 and can go up to several million dollars | Open |
| BDC Small business loan | Loan | Up to $350,000 per BDC Small Business Loan: up to $100K (up to 6 months interest-only payments, 5-year amortization) or over $100K and up to $350K (up to 12 months interest-only payments, up to 8-year amortization) | Open |
| BDC Working capital loan | Loan | No fixed amount | Open |
