Government Business Loans SBL Loan Program |7 Park Avenue Financial

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Government Business Loans -  How The SBL Loan Program Can Help Your Company
What’s The Noise And Commotion Around Government Loans?



 

YOUR COMPANY IS LOOKING FOR GOVERNMENT BUSINESS LOANS!

Financing Success For Small Businesses Via Canadian Government Funding

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Financing & Cash flow are the  biggest issues facing businesses today

ARE YOU UNAWARE OR   DISSATISFIED WITH YOUR CURRENT  BUSINESS  FINANCING OPTIONS?

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EMAIL - sprokop@7parkavenuefinancial.com

 

 

 

GOVERNMENT FINANCING PROGRAMS IN CANADA 

 

 

Canadian business owners/managers might just get some valuable financing assistance from the 800 lb. gorilla of government business loans - we're referring of course to the SBL loan program in Canada, formally known as the Canada Small Business Financing Program.

 

These loans are government-guaranteed loans that support both growing and starting a business - Your business can choose to buy assets as well as access key financing for other parts of your business. This is a government guaranteed / government-sponsored business that offers term loans and working capital and line of credit facilities for small businesses - The SME Commercial Financing sector in  Canada is underserved when it comes to financing options for businesses.


NEW IMPROVED  FINANCING AMOUNTS & FLEXIBILITY

 

It has never been easier to access loans from traditional financial institutions with the help of government loan guarantee funding programs - The essence of the program is the bank's ability to share risk with the Government of Canada.

 

Term loans under the program can be used for a variety of needs - These include

 

Buying land and  buildings via commercial real estate financing

Buying new or used assets required by the business

Funding leasehold improvements to  leased premises

Intangible assets, previously unfinanceable - can now be financed!

 

Working Capital / Lines Of Credit

 

Many small businesses are unable to access business credit lines and working capital loans for their business based on traditional credit requirements imposed by banks - Under the Canada Small Business Loan program this has become easier as  business credit lines can be accessed, as well as working capital facilities

Credit lines and working capital solutions under the program allow a business to meet its day-to-day financing obligations around business expenses.

 

 

LOAN TERMS / RATES/STRUCTURES / THE FLEXIBILITY YOU HAVE BEEN LOOKING FOR! 

 

Let's summarize the key benefits of the new financing guidelines put in place in 2022

 

85% of the government business loan is guaranteed by the federal government of Canada

 

Assets purchase previously with 1/2 year of the financing request can be  refinanced under the program

 

Companies have the ability to  choose either fixed or variable interest rates

 

Term loan amortizations around assets and real estate can be financed up to a 10-year amortization ( Leasehold improvements are 7 years )

 

Commercial real estate purchased under the guidelines of the program can access a 15-year amortization

 

The loan amount cap for leasehold sand assets is 500k

 

Working Capital and Intangible assets are capped at 150k

 

Real estate loans are available up to 1 Million dollars with possible 20-year amortizations

 

THE BOTTOM LINE? For a qualifying business, these loans offer solid rates, terms and structures. The bottom line... affordable and great access to capital with excellent terms and conditions. ( The actual loan cap of the program is 1 Million dollars but some restrictions around that apply)

 

 WHERE DOES THE PROGRAM COME FROM? WHO RUNS THE ' SBL ' LOAN PROGRAM

 

Most Canadian businesses aren't really aware that the government department known as INDUSTRY CANADA has this loan program in place to help you succeed in business. And that can be from a start-up right up to when you achieve your first 10 Million dollars in revenue.  (The 10M is the revenue cap your company or business must be under to qualify for the loan - This loan cap was previously 5M$).

 

Quite frankly the program is one of your best friends for financing items such as equipment, leasehold improvements, computers and application software, and even real estate if that’s applicable.

 

The first thing you need to understand is that  INDUSTRY CANADA itself, the ' sponsor ' of the program does not make the actual loans. They charter our Canadian banks to make these loans, and the government underwrites or guarantees most of the loans.

 

As we have said in the past - ‘Talk about a great co-signer ‘!  Since the banks are assured of payment they of course become much more flexible when it comes to amortizations of the loan, credit approval, and other ratios such as debt to equity.

 

Naturally, this program is geared toward supporting business development in Canada - it's no secret that the majority of growth and employment these days comes from the SME sector... That’s where start-ups evolve, business grows into corporations and people get hired. That’s economics 101 we guess.

 

So what do you have to do to qualify for this SBL loan program? That's the most often asked question from clients inquiring about government business loans.  The basics are decent personal credit history, a minimum equity down payment of 10 percent, and the ability to demonstrate your business has the working capital to get out of the start-up phase.

 

The problem arises when the business owner/applicant thinks the SBL loan program is ' easy ' to get. We're a bit biased - we don’t think it's hard, but you do in fact have to have some fundamentals in place. Oh, and by the way, many bankers either aren't familiar with the program or are incapable of putting together the application, only because of their lack of interest or experience.

 

So, point taken, seek out a banker or, even better, an independent Canadian business financing advisor who can get you fast-tracked to financing success.

 

  

BDC SMALL BUSINESS LOANS  

 

BDC is the government of Canada's crown corporation chartered to provide small business loan financing in Canada.  Businesses can utilize financing to buy assets and technology used in the business as well as use funds to enhance  the marketing of business around websites, digital innovation, marketing and sales campaigns, etc,

 

Long-term working capital loans from BDC are lump sum term loans that help businesses purchase inventories, manage current liabilities, etc., offering flexible lump sum payments structured to business needs and financial support needed by the business.

 

BUSINESS GRANTS  / GRANT FINANCING / CANADIAN GOVERNMENT GRANTS FOR SMALL BUSINESS

 

There are numerous government grant programs that are available for funding businesses in Canada - These programs are both federal and provincially available with the government goal of supporting small businesses as well as larger corporations, and even non for profit organizations. A significant amount of time is often spent by businesses in determining which program suits their specific needs, as well as understanding the qualifications. Temporary interest free loans are sometimes structured and offered.

 

Some businesses utilize grant writers who specialize in submitting applications for particular programs that focus on the merits of the business with respect to grants available - By employing these grants writers many companies feel that have a strong level of approval success as well as the obvious time savings when balanced against the cost of the grant writer.

 

IRAP Grants provide grant funding for unique research and development projects, and NSERC  grants are also widely popular.

 

Grants and other subsidies are available for employee acquisition/training, business expansion, and the adoption of new technologies around research and innovation around project costs. Canada's Sr&ed Program ( The Canadian Scientific Research and Experimental Development ) via Canada Revenue Agency is, along with the Canada Small business loan program the largest and most popular government funding program in Canada. These 2 programs provide billions of dollars of funding annually in the form of government-guaranteed loans,  refundable tax credits, and grant financing.

 

Services to support aboriginal business and black business owners are also popular grant programs that offer small business financing solutions &  business support.

 

Talk to the 7 Park Avenue Financial team about how grant financing and sr&ed financing might help your business around cash flow needs. Grants are available in a number of areas including start-up grants,  wage subsidies, and research assistance and are a great solution compared to venture capital that dilutes owner equity at the business start-up phase which is critical to owners maintaining equity and non-dilution when start up money is so valuable.

 

 

CONCLUSION

 

To recap, over 8000 businesses every year are approved under the Government loan program to support economic development in Canada. All you need is a business plan and some typical backup information that you would have to supply for any type of financing whatsoever. And don't forget, outside collateral is not required- and you'll be more successful if you demonstrate you have the character and experience to make your business successful.

 

So, what is all the noise about?   It/s the fact that financing you need just might be around the corner via the Canada small business financing program. Both new and existing businesses, as well as anyone seeking a franchise loan, should investigate the program.

 

Speak to 7 Park Avenue Financial,  a trusted, credible and experienced Canadian business financing advisor who can assist you with your business funding needs around business growth.

Click here for the business finance track record of 7 Park Avenue Financial

' Canadian Business Financing With The Intelligent Use Of Experience '

 STAN PROKOP
7 Park Avenue Financial/Copyright/2024

 

 

 

 

 

Stan Prokop is the founder of 7 Park Avenue Financial and a recognized expert on Canadian Business Financing. Since 2004 Stan has helped hundreds of small, medium and large organizations achieve the financing they need to survive and grow. He has decades of credit and lending experience working for firms such as Hewlett Packard / Cable & Wireless / Ashland Oil