OTTAWA — The federal government extended the Canada Emergency Business Account on Monday until the end of October.
Finance Minister Chrystia Freeland says the government is also working with financial institutions to expand eligibility to companies that have been shut out of the program. That would include those who use personal rather than business bank accounts.
“This gives businesses two extra months to apply for a CEBA loan,” she said, “to help them get through this difficult time and, ultimately, to emerge stronger.”
Freeland added details about eligibility changes will be released in the coming days. The government had said in mid-May it was working to address the eligibility issue.
The business loan program has provided more than $29 billion in credit through more than 730,000 loans.
— Cormac Mac Sweeney (@cmaconthehill) August 31, 2020
Eligible businesses can receive interest-free loans of up to $40,000 through the program and have one-quarter of the outstanding amount forgiven if the balance is repaid by the end of 2022.
Also Monday, the parliamentary budget watchdog announced another program to provide rent relief to small and medium-sized businesses will cost just under $1 billion this fiscal year.
The report from the parliamentary budget officer says the commercial rental-assistance program will now cost $931 million after it was extended through to August.
“I have talking, just over the few days, with many of the finance ministers of the provinces and territories about ways we can support Canadian small business, including when it comes to covering their fixed costs, of which rent is a very, very big share,” Freeland said. “We’re working on it.”
The updated spending projections from the parliamentary budget office still put the program on track to provide less help than the nearly $3 billion the Liberals budgeted.
The program provides forgivable loans that cover half of the rent for eligible small businesses, and also requires landlords to waive a further one-quarter of what they’d otherwise be owed.
The Canadian Federation of Independent Business wants the government to allow tenants to apply directly for help under the commercial rental-assistance program, rather than rely on their landlords to do so.
The federation has warned that too many small businesses still haven’t been able to access the help because it relies on landlords to apply and sets a high bar for revenue losses to qualify.