Prime Minister Justin Trudeau announced the expanded loan program during his daily news conference on April 16, saying the government had heard concerns from some businesses and entrepreneurs in need that the previous criteria excluded them.
The Canadian Emergency Business Account will now provide up to $40,000 in government-guaranteed loans to businesses that had payrolls last year between $20,000 and $1.5 million. It previously offered loans to business with a narrower range of payrolls, between $50,000 and $1 million.
“No one should feel as if they’re alone in this fight,” Trudeau said. “Our government is here to help you through these challenging times. So when we hear the program is not reaching as many people as it should, we make changes.”
Since the loan program was launched last month, Trudeau added, businesses have taken out 195,000 loans worth a total of $7.5 billion. The loans are interest-free until Dec. 31, 2022 and if they’re paid off by then, up to 25 per cent of the total will be forgiven.
“This is money entrepreneurs and employers can use to cover operational costs and help with other immediate needs,” Trudeau said.
The federal government is also working on a program to help businesses and commercial landlords cover their rents for at least three months, though the details still need to be worked out with the provinces and territories.
“This program will provide support to help small businesses with their rents for the months of April, May and June,” Trudeau said. “To implement this program, we have to work with the provinces and territories as they govern rental relationships.”