Update May 21, 2020

In addition to what has been announced for the Canada Emergency Business Account, (CEBA), the government of Canada has recently announced an expansion to the current eligibility criteria to the program to help small businesses protect the jobs that they and most Canadians rely on.

The program will now be available to a greater number of businesses that are

  • Sole proprietors receiving income directly from their businesses,
  • Businesses that rely on contractors and sub-contractors, * Family-owned corporations that pay employees through dividends rather than payroll.

As the details have not been finalized yet, please check with your RSW advisor and our website regularly as we will keep you updated as more information is made available.


Previous Information

On April 1st, the Finance Minister, Bill Morneau announced several measures supporting the cash flow requirements of small and medium businesses. We will report on all of them however, we would like to focus on one measure in particular; the Canada Emergency Business Account.

CEBA is a program that will provide $25 Billion to financial institutions so they can provide Interest Free Loans to their small and medium size business clients.

When will the loan be available?

Most financial institutions are currently finalizing the implementation and qualification criteria with the federal government. However, the following has been announced:

  1. The loan should be used for the most pressing financial needs such as rent and payroll;
  2. Applications for the loans will become available during the week of April 6, 2020
  3. Applications will have to be made online, using your financial institution website, or in-branch visits. We highly recommend that you use the online version of the application or contact your branch advisor for more information.

How long will it take to access the funds?

Upon receipt of a completed application and if the business qualifies, the $40,000 loan will be accessible as a line of credit in the business’ operating account. The funds will be available to support the operating expenses, within a few days.

What kind of information needs to be provided and what are the requirements?

Businesses and Non-for-Profit organizations will be eligible to apply, if you have at the time of application:

1.) An operating company is registered in Canada:

  • If you are incorporated under federal jurisdiction, please consult your Corporation Canada Registration online at


Download the search result and have it handy, in case you are required to provide the Incorporation Registry number.

  • If you are incorporated under the province of Quebec, please consult the Online Corporate Registry – Registre des Entreprises du Quebec at


Download the search result and have it handy, in case you are required to provide the NEQ number.

  • If you are incorporated under the Legislation of another province, please consult the specific Online Corporate Registry for your province

2.) Have annual payroll of between $50,000 and $1 million based on your 2019 T4 Summary of remuneration paid. We encourage you to contact your RSW advisor for more information and/or if you want to obtain a copy of your T4 Summary.

What are the financial details of the loan?

The loan is interest-free until December 31, 2022. Also, no principal repayments are required during this period. After this date, the loan will be converted into a 3 (I think it’s 5)-year term loan bearing an interest rate at 5% (according to RBC).

If you decide to repay $30,000 of the loan before December 31, 2022, $10,000 or 25% of the loan is eligible for complete forgiveness. Please note that it is always a good practice to make regular and fixed instalment payments that would possibly match your incoming cash flow after expenses.

For example, if you obtain the $40,000 loan on July 1st, 2020 and decide to repay the $30,000 as you want to benefit from the loan forgiveness portion. You will be afforded 30 months or 2 and half years to repay the $30,000. This would translate into a monthly payment of $937.50.