Expansion of Canada Emergency Business Account (CEBA)

By Noor Wais, Oct 13, 2020

On October 9, 2020, the government of Canada announced the expansion of Canada Emergency Business Account (CEBA).

CEBA has been expanded to provide an interest-free loan of up to $20,000 for businesses impacted by COVID-19.

5 things to know about the expanded CEBA:

  1. The $20,000 is in addition to the original CEBA loan of $40,000
  2. Up to $20,000 of the total CEBA loan of $60,000 (i.e. $40,000 original CEBA loan + $20,000 additional loan) would be forgivable if the balance of the loan is repaid before December 31, 2022
  3. CEBA is also being expanded to make available to small businesses additional loans of $20,000, with $10,000 of those eligible to be turned into forgivable loans if paid back by a certain date.
  4. An attestation of the impact of COVID-19 on the business will be required to access the additional financing.
  5. Businesses applying for the loans will be required to prove they have faced income losses specifically caused by COVID-19.

CEBA was initially launched in April 2020 to provide zero-interest, partially forgivable loans to small businesses that have experienced decrease in revenues due to COVID-19 but face ongoing costs, such as rent, utilities, insurance, taxes and employment costs.

The additional CEBA loan would effectively increase CEBA loans to $60,000 from $40,000 for eligible businesses, of which a total of $20,000 would be forgiven if the balance of the loan is repaid before December 31, 2022.

As of early October, over 765,000 CEBA loans have been approved, representing more than $30 billion.

For more details and up to date information, consult the official CEBA website