With the COVID-19 pandemic continuing to take a toll on the economy, many small business owners are still relying on government relief programs such as the Canada Emergency Business Account (CEBA) to stay afloat. However, as the deadlines for CEBA loan repayment loom, many are wondering if the program will be extended once again. In this blog post, we will explore the latest updates on the CEBA program, discuss the loan repayment process, and provide refinancing advice for small business owners who are struggling to make ends meet.
The CEBA program was initially launched in April 2020 to support small businesses affected by the COVID-19 pandemic. Eligible businesses could apply for a $40,000 interest-free loan, with a forgiveness option of up to $10,000 if certain conditions were met. The program was extended multiple times, with the latest extension allowing businesses to apply until June 30, 2021.
As of now, there has been no announcement regarding further extensions of the CEBA program. In fact, the program is already in the loan repayment phase for some businesses that received the loan earlier. According to the CEBA program outline, businesses that have not repaid the loan by December 31, 2022, will be subject to an interest rate of 5%. As such, small business owners are encouraged to plan and prepare for the loan repayment process.
If your business is struggling to make the CEBA loan repayment, refinancing may be an option to consider. Refinancing involves taking out a new loan to pay off the original CEBA loan, potentially with better interest rates and repayment terms. Keep in mind that not all lenders may offer refinancing options, so it’s essential to research and compare different lenders to find the best fit for your business.
Another option to consider is applying for the Highly Affected Sectors Credit Availability Program (HASCAP), which provides loans of up to $1 million for businesses heavily impacted by the pandemic. The program is tailored to specific industries, including tourism, hospitality, and entertainment, among others. Eligible businesses can use the funds to cover their expenses, including the repayment of existing debt.
Alternatively, small business owners may look into other government programs and grants available to support businesses during the pandemic. For instance, the Canada Emergency Wage Subsidy (CEWS) provides a subsidy to eligible businesses to help cover their employees’ wages and keep them employed. The program has been extended until September 25, 2021, with the possibility of further extensions.
In conclusion, small business owners who received the CEBA loan should start planning and preparing for the loan repayment process, given that the program is currently in the repayment phase. Refinancing, applying for other government programs, and seeking financial advice from experts are some of the options available to businesses struggling to make ends meet during the pandemic. While there’s no guarantee of another CEBA extension, there are other forms of assistance available to help small businesses survive and thrive in these challenging times.