Thursday is the deadline to repay federal COVID-19 loans for businesses that have not already done so.
• Also read: Repayment of emergency aid: Banks contacted by companies under pressure
In total, almost 30% of the 80,000 companies have not yet repaid their COVID loan.
“We are noticing some pressure, but it is mainly affecting companies that have ceased operations and have decided to place themselves under the protection of bankruptcy law,” mentions Pierre Fortin, President of Jean Fortin et Associés.
However, there are two solutions for entrepreneurs before filing for bankruptcy.
- Listen to the column on business and entrepreneurship with Philippe-Richard Bertrand
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Refinance
Companies could benefit from a few weeks extension if they had requested it.
“We had until today to submit an application to refinance the loan. If this is the case, entrepreneurs will have until March 28 to repay the loan and benefit from the $20,000 grant,” he says.
Remember that the government offers a $20,000 gift to companies that can repay loans of up to $60,000.
refund
“Starting tomorrow, the emergency loan will be converted into a temporary loan. Entrepreneurs have three years to repay the loan and the capital does not have to be repaid until December 31, 2026. The entrepreneur's only obligation is to pay interest on the loan and the interest rate has been set by the government at 5%. That corresponds to around half the cost of a commercial loan,” explains the consultant.
Watch the specialist's advice in the video at the top of the page.