Le Lézard
Classified in: Business, Covid-19 virus
Subjects: SVY, AVO

One in five small businesses too small to qualify for a federal emergency loan: Changes to CEBA urgently needed


TORONTO, April 14, 2020 /CNW/ - While the Canada Emergency Business Accounts are welcome relief for small businesses able to access them, many are reporting that eligibility requirements are shutting them out, according to a new survey by the Canadian Federation of Independent Business (CFIB).

"Nearly 80 per cent of small businesses are fully or partially closed due to COVID-19 with little or no revenue coming in, while their bills continue to pile up," said Dan Kelly, CFIB's president. "The Canada Emergency Business Accounts allow the banks to offer a loan of up to $40,000 backed by the federal government with no interest and up to $10,000 forgivable when fully repaid by December 2022. While more debt isn't the answer for every business owner, thousands of small firms have applied for this much needed lifeline. Unfortunately, the smallest businesses ? those with payrolls under $50,000 ? are not eligible for the support."

CEBA loans require a business to have between $50,000 and $1 million in payroll. As many small firms pay the owner and the owner's family through dividends rather than salary, this test excludes thousands of long-standing firms. Others, including micro-sized business and newer firms, are also finding themselves ineligible for the program. 

"We're hearing from many hard-hit businesses that need the loan but don't qualify, whether it's because they're too small, too large or don't have a payroll," added Corinne Pohlmann, CFIB's senior vice-president of national affairs. "Criteria that made sense three weeks ago don't make as much sense today and we are hoping the federal government will change this program to cover more of those in need as it did with the Canada Emergency Wage Subsidy."

CFIB recommends the following improvements to CEBA:

"As we enter a second month of a virtual shut-down of most small businesses, all solutions need to be structured with flexibility in mind," concluded Kelly. "The CEBA is a good initiative and could help many businesses hold on, if they are allowed to access the program."

Some additional survey results for the week of April 13:

Note on survey methodology
These preliminary findings are based on 10,620 responses, collected from CFIB members, to a controlled-access web survey that is still active. Data reflect responses received between April 10 and April 13, 2020. For comparison purposes, a probability sample with the same number of respondents would have a margin of error of +/-0.9%, 19 times out of 20.

About CFIB
The Canadian Federation of Independent Business (CFIB) is Canada's largest association of small and medium-sized businesses with 110,000 members across every industry and region. CFIB is dedicated to increasing business owners' chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.

SOURCE Canadian Federation of Independent Business


These press releases may also interest you

at 08:38
Staffing Industry Analysts announced its 2024 Best Staffing Firms to Work For list this week, honoring Omaha-based healthcare company Fusion as a winner in the category of staffing firms with more than 500 employees. SIA's Best Staffing Firms to...

at 08:37
In a landmark move, Greenlight Commercial Funding (GCF) has announced its support for Audacity Zone Developments, INC. through an $11 million Series A Preferred Equity Offering. This underscores the company's unwavering commitment to fostering...

at 08:36
Brody's Crafted Cocktails, the highly-acclaimed premium ready-to-serve craft cocktails, proudly announces its latest addition to an ambitious 2024 expansion strategy in collaboration with Savannah Distributing Company. This family-operated wholesale...

at 08:35
SatixFy Communications Ltd. (the "Company" or "SatixFy") , a pioneering force in next-generation satellite communication systems driven by in-house developed chipsets, has released its consolidated financial results for the full year period ended...

at 08:34
AVO Cigars, a leader in hand-made premium cigars announces the release of the "Avo Expressions 2024." This highly anticipated blend is a collaboration with world-renowned DJ D-NICE. Only 6,900 boxes containing fifteen cigars were created of this...

at 08:30
Asahi Kasei Plastics North America Inc (APNA), manufacturer of Asaclean and a leading supplier of purging compounds for the plastics industry, has announced a new partnership with renowned plastics distributor, Polysource. This exclusive distribution...



News published on and distributed by: