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Where can I apply for a
loan under the Canada Small Business Financing Act
(CSBFA)?
Most banks, credit unions, caisses populaires and other
financial institutions are eligible to make loans under the
Canada Small Business Financing Act (CSBFA). There are more than
1500 participating lenders with 15 000 branches
across Canada. The decision to grant or not to grant a loan is
up to the lender.
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Should I communicate
with Industry Canada for a loan?
The Canada Small Business Financing Program Directorate at
Industry Canada is available to provide you with information
related to the program. Industry Canada does not get involved in
the decision making process of financial institutions nor does
it accept or process loan applications.
This program is delivered by financial institutions on behalf of
the federal government. Financial institutions are required to
apply the same care and procedures in making a CSBF loan as they
would for conventional loans of similar amounts. Decisions
related to granting loans rest entirely with lenders.
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Why do some financial
institutions choose not to participate in this program?
Even though most financial institutions participate in the
program, the decision to lend under the program is up to the
individual lender.
List of Lenders
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What businesses are
eligible to apply under this program?
Most for profit small and medium size businesses in Canada with
gross revenues or projected revenues of less than
$5 million are eligible to apply for loans under this
program. Such businesses can be corporations, sole proprietors,
or partnerships.
Farming businesses are not eligible under this program since the
Farm Improvement and Marketing Cooperatives Loans Act
(FIMCLA) which is administered by Agriculture and Agri-Food
Canada is a loans program designed to increase the availability
of loans for the purpose of farming. More information on FIMCLA
is available at: FIMCLA
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What is eligible for
financing under this program?
Loans can finance the cost of:
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How much can be
financed under this program?
Financial institutions can finance up to 90% of the cost of
asset acquisition or asset improvement.
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What is the maximum
loan amount I can access under this program?
The maximum loan amount a small business can access under this
program is $250,000.
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What are the
costs?
Registration Fee:
The registration fee is 2% of the total amount of the loan.
Yes, it can be financed and added to the total amount of the
loan provided that the maximum amount does not exceed $250,000.
Interest Rate:
The maximum interest rate that a lender may charge on a
commercial loan is prime plus 3% on floating rate, or the
lender's residential mortgage rate plus 3% on fixed rate.
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If my financial
institution rejects my business proposal and does not approve my
application for a loan under this program, what can I
do?
Decisions to lend is based on lending criteria of each financial
institution. You could contact another financial institution
since lenders have different criteria related to the granting of
commercial loans.
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Who can be contacted
if my application for a loan has been refused unfairly?
Often your financial services providers will want to resolve a
complaint promptly and fairly. You should:
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Talk with your account manager or the person you
originallly dealth with and explain the problem.
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Make a complaint to the next level (i.e. branch, district
or regional manager) of dispute resolution with the firm.
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Contact the Office of the Canadian Ombudsman for Banking
Services and Investments at the following coordinates:
Ombudsman for Banking Services and Investments
P.O. Box 896
Station Adelaide
Toronto, ON
M5C 2K3
Toll Free Telephone: 1-888-451-4519
Toll-Free Fax: 1-888-422-2865
Toronto area telephone: (416) 287-2877
Toronto area fax: (416) 225-4722
E-mail: ombudsman@obsi.ca
Web site: http://www.bankingombudsman.com
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