In an interview with The Canadian Press, Michael Denham said that the Business Development Bank of Canada’s program would now be open to all businesses.
“Any legal firm is eligible to be part of the program – this is what I think has been of concern to some industry groups,” said Denham of Montreal. “This has been clarified and we will officially announce it on Monday. “
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Applicants must go through their own bank to access the program.
The Business Development Bank is a federal corporation with a loan portfolio of approximately $ 35 billion. The $ 40 billion credit availability program will add to that, said Denham.
Although it supports higher risk loans than banks, the Crown corporation aims to be commercially viable. Those who approach their financial institutions for access to the program will have to prove that they could have managed a loan before the coronavirus struck.
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The development bank, which has approximately 60,000 customers, has made other changes given the unprecedented impact of the pandemic, said Denham. It has lowered interest rates, waived fees and increased the risk it takes on its loans.
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“All of these changes are intended to make us as easy and accessible as BDC is a lender,” said Denham. “We do what we have to do. “
Struggling businesses lobbied for the postponement of existing loan obligations as well as access to capital loans to help them weather the COVID storm.
The restaurant industry has been particularly affected by the widespread closures that governments and health authorities have ordered to curb the spread of COVID-19. A recent survey suggested that almost one in 10 restaurants had already closed and almost one in five planned to close if conditions did not improve quickly.
The cannabis industry, which had struggled before the pandemic, also closed its stores, although online sales continue.
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The development bank has seen a flood of new applicants in recent weeks. As many applications have been submitted via its online funding platform since the start of the crisis in mid-March that they would normally have been received on a full-year basis.
“This indicates the amount of demand and the volume we need to meet,” said Denham. “We are organizing ourselves to be able to cope with this level of volume, due to the intensity of the crisis.”
Like many other Canadians, the 2,300 employees of the development bank were sent home on Friday, March 13. The organization reopened the following Monday, with staff working remotely.
Meanwhile, federal aid claims are expected to start to overflow on Monday as those who have lost their jobs begin to apply for emergency benefits. Prime Minister Justin Trudeau said people would start receiving their $ 2,000 a month within five days if they used direct deposit.
“My advice to all entrepreneurs: understand the programs, talk to your bank, see what works for you and take advantage of it,” said Denham.
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