Extension granted for payment of emergency commercial account

Businesses struggling under another round of closures and capacity restrictions will have one more year to pay off emergency interest-free loans issued by the federal government, but business groups say that may not be enough respite for those hardest hit.

Canada’s Emergency Business Account offered interest-free loans of up to $60,000 to small businesses and non-profit organizations.

When the government first created the CEBA program at the start of the pandemic, it set a payment deadline of December 31, 2022 for anyone who wanted to take advantage of zero interest and forgiveness of a portion of the loan.

But since then, some businesses have had only brief respites from the onslaught of COVID-19 and the accompanying restrictive public health measures.

“The bottom line is, of course, this: We will continue to be there, to support people with whatever it takes, however long it takes, until we get through this pandemic,” Prime Minister Justin Trudeau told a news conference. press. Informative Wednesday.

Businesses that were approved under Canada’s Emergency Business Account will now have until the end of 2023 to pay off their loans, Trudeau announced.

The government also extended the loan forgiveness period.

Businesses that pay what they owe by the end of 2023 will be offered 33 percent loan forgiveness, up to $20,000.

The news was especially welcomed by Restaurants Canada, which represents some of the businesses hardest hit by closures and gathering limits.

Government extends return period to emergency business account until 2023. #CDNPoli #COVID19 #CEBA

“With most restaurants across the country now taking on even more debt in the face of the Omicron wave, ensuring they will have enough cash flow to continue operations will become increasingly critical,” the association said in a statement on Wednesday. .

Since its launch, Canada’s Emergency Business Account has provided loans worth $49.17 billion to more than 898,000 businesses, most of which are in Ontario.

The extended deadline will give businesses some much-needed breathing space, said Alla Drigola Birk, director of parliamentary affairs at the Canadian Chamber of Commerce.

“It’s very welcome news because from the Canadian chamber’s perspective, we had a lot of companies that were getting a little nervous about the next deadline,” Drigola Birk said in an interview.

“But with the Omicron wave and the new lockdowns that many provinces have put in place across the country, those businesses that would have had a hard time paying back loans before this wave will have an even harder time paying back the loan on time.” meet the deadline to receive the forgivable part.

The Canadian Chamber of Commerce and the Canadian Federation of Independent Businesses have called on the government to further delay the repayment deadline, to December 2024, to help more recipients take advantage of zero-interest and forgiveness options.

“There is not a lot of debt for debt relief, especially for COVID debt,” Drigola Birk said.

A survey of CFIB members late last year suggested they could take another two years to return to profitability.

CFIB has asked the government to consider allowing businesses to apply for another $20,00 loan and increase the forgiveness to 50 per cent, up to $40,000.

CFIB President Dan Kelly also said the program should be expanded to include startups, micro-enterprises and the self-employed.

This report from The Canadian Press was first published on January 12, 2022.


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