One in five small businesses nationwide risks closing their doors in 2024 if Ottawa doesn’t extend the repayment period for Canada Emergency Business Account (CEBA) loans, the Canadian Federation of Independent Business (CFIB) warns.
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The current deadline to repay the loan is December 31, 2023.
Without extending this period, these companies lose the grant portion of the loan, up to $20,000, and pay 5% interest on their entire balance.
In Quebec, 34% of SMEs are likely to miss their CEBA loan repayment deadline in 2023, and 17% of SMEs are at risk of going out of business if their CEBA loan repayment deadline (CEBA) is not extended, equivalent to 45,327 businesses .
“The message from small business owners is loud and clear: they want more time to pay off their loan. Almost three quarters of our members say they need more time. You should also know that only half of SMEs have returned to their usual level of turnover. Sales are weak and debt is high. The government must act. The deadline for repaying the CEBA loan has to be postponed. But time is pressing. Ottawa must intervene now,” says Jasmin Guénette, vice president for national affairs at the CFIB.
According to the CFIB, nine out of ten small business owners have received a CEBA loan.
Of these, three-quarters received between $40,001 and $60,000, and a quarter received $40,000 or less.
However, only 10% of the beneficiaries repaid their loan.
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