Canada Emergency Business Account (CEBA)

Applicants with a $40,000 CEBA loan may apply for the $20,000 expansion.

Yes, you may apply for the $20,000 expansion at the financial institution that provided you with your original CEBA loan.

The following terms apply to all CEBA loans (original loan and expansion loan):

Interest:

• 0% per annum interest until December 31, 2022
• 5% per annum interest starting on January 1, 2023; interest payment frequency to be determined by your financial institution

Repayments & Maturity:

• No principal repayment required before December 31, 2022
• If loan remains outstanding after December 31, 2022, only interest payments required until full principal is due on December 31, 2025

Debt Forgiveness:

• If the outstanding principal, other than the amount of potential debt forgiveness, is repaid by December 31, 2022, the remaining principal amount will be forgiven, provided that no default under the Loan has occurred

Applicants applying for the expansion can only apply for the full $20,000.

Once your financial institution begins to offer the $60,000 loan you may no longer apply for $40,000.

Please contact the financial institution that provided you with your original CEBA loan to apply for the $20,000 expansion.

No, you must apply for the $20,000 expansion at the financial institution that provided you with your original CEBA loan.

Yes, you will need to submit a new application and attestation to the financial institution that provided you with your original CEBA loan.
You will not need to resubmit your original application, or re-upload expense documents.

Please consult with your financial institution as cancellations may or may not be offered by your financial institution.

Note that choosing to cancel your application will reset adjudication timelines, adding additional processing time. An additional attestation will need to be submitted to apply for a $60,000 loan.

With respect to your existing $40,000 loan application, once you have applied at your primary financial institution, uploaded all necessary supporting documents (if applicable), and if pre- funding eligibility validation is successful, you should expect to receive funding within 10-15 business days. Upon approval of your original loan application, you may then apply for an expansion with your financial institution.

Once you have applied at your financial institution, uploaded all necessary supporting documents (if applicable), and if pre-funding eligibility validation is successful, you should expect to receive funding within 10-15 business days.

If you borrowed $40,000 or less:
Repaying the outstanding balance of the loan (other than the amount available to be forgiven) on or before December 31, 2022 will result in loan forgiveness of 25 percent (up to $10,000).

Example 1:
Maximum Amount Borrowed: $40,000
Amount Repaid By December 31, 2022: $30,000 Available Forgiveness: $10,000

Example 2:
Maximum Amount Borrowed: $20,000
Amount Repaid By December 31, 2022: $15,000 Available Forgiveness: $5,000

Example 3:
Maximum Amount Borrowed: $40,000
Amount Repaid By December 31, 2022: $25,000 Available Forgiveness: $0
If you borrowed more than $40,000 and up to $60,000:
If you received a $40,000 loan and subsequently received the $20,000 expansion, the terms of your forgiveness have changed and are described here.
Repaying the outstanding balance of the loan (other than the amount available to be forgiven) on or before December 31, 2022 will result in a single tranche of loan forgiveness up to $20,000 based on a blended rate:
• 25 percent on the first $40,000; plus
• 50 percent on amounts above $40,000 and up to $60,000.
For clarity, the portion of forgiveness based on a rate of 25% and the portion of forgiveness based on a rate of 50% are combined into a single tranche of forgiveness, which is only available if all other amounts outstanding are repaid by December 31, 2022. For example, if $60,000 is borrowed, no forgiveness is available unless $40,000 is repaid.
Note: some financial institutions may record your $40,000 loan and $20,000 expansion as two separate loans. For the purposes of loan forgiveness, borrowings and repayments on both loans will be aggregated.

Example 4:
Maximum Amount Borrowed: $60,000
Amount Repaid By December 31, 2022: $40,000 Available Forgiveness: $20,000 ($40,000 x 25% + $20,000 x 50%)

Example 5:
Maximum Amount Borrowed: $50,000
Amount Repaid By December 31, 2022: $35,000 Available Forgiveness: $15,000 ($40,000 x 25% + $10,000 x 50%)

Example 6:
Maximum Amount Borrowed: $60,000
Amount Repaid By December 31, 2022: $35,000 Available Forgiveness: $0
If you fully repaid your original $40,000 loan, claimed forgiveness, and thereafter received the $20,000 expansion:
Repaying the outstanding balance of the $20,000 expansion (other than the amount available to be forgiven) on or before December 31, 2022 will result in loan forgiveness of 50 percent (up to $10,000).

Example 7:
Maximum amount Borrowed: $20,000
Amount Repaid By December 31, 2022: $10,000 Available Forgiveness: $10,000

Example 8:
Maximum amount Borrowed: $20,000 Amount Repaid By December 31, 2022: $8,000 Available Forgiveness: $0

Applicants who received a $40,000 loan must apply separately for the $20,000 CEBA expansion.
In instances where additional information is needed from you or your financial institution relating to your original loan application, or if post- funding validations identified a discrepancy between your original loan application and CRA records, your expansion application may be declined.
Depending on the reason for decline, you may or may not be able to remedy your application.

Depending on the reason for decline, you may or may not be able to remedy your application. Your financial institution will be notified and will instruct you on the next steps if any action or input is required from you.

The deadline to apply for the $20,000 expansion at your financial institution is March 31, 2021.

Once you have applied at your financial institution and if pre-funding eligibility validation is successful, you should expect to receive funding within 10-15 business days.

Yes. These programs are independent of each other and you can still enrol in CEBA.

No, CEBA is only available to business members who meet the eligibility requirements as set out by the federal government. One of the criteria for the program is that the borrower must have a business account with its financial institution. The government has announced additional relief measures to support sole proprietors. For further information, please visit the Government of Canada’s COVID-19 Economic Response Plan site.

The individual applying for and enrolling your organization in CEBA will need to have the authority to sign on behalf of and bind the organization to the terms of the CEBA loan agreement. If your organization currently requires consent of more than 1 director or officer to bind the organization, the organization is responsible for preparing and approving a resolution that allows the individual applying for the loan to be given this authority prior to submitting the application. We cannot accept multiple signatures.

Yes. Each business entity is able to enrol in CEBA, subject to each business individual meetings the eligibility requirements.

No. You can only enroll in CEBA once for your business, at your primary financial institution. Applying at more than one financial institution may result in legal prosecution by the federal government and you may be required to immediately repay any loans.

Per the requirements of the Program, as set out by the Government of Canada, the Borrower confirms that: It is not a government organization or body, or an entity owned by a government organization or body; It is not a union, charitable, religious or fraternal organization or entity owned by such an organization or if it is, it is a registered T2 or T3010 corporation that generates a portion of its revenue from the sales of goods or services; It is not an entity owned by individual(s) holding political office; and It does not promote violence, incite hatred or discriminate on the basis of sex, gender, sexual orientation, race, ethnicity, religion, culture, region, education, age or mental or physical disability.

You are required to meet all eligibility criteria for the loan, as detailed in the application, including an acknowledgment that the funds from this loan will only be used to pay for non-deferrable operating expenses. In the application, you will be required to make an attestation that you meet these criteria, which is subject to verification and audit. All applications are subject to approval and funding availability through the CEBA program.

The CEBA eligibility criteria have been set by the federal government. For questions related to the government’s eligibility criteria, please visit www.CEBAquestions.ca, a website set up by Export Development Canada, the program’s administrator, for this purpose.

Given the unpredictability of the COVID-19 pandemic, it may make sense for you to hold on to your CEBA funds as a contingency, especially as the loan is interest-free until December 31, 2022. More details on the repayment process will be coming soon.