by Morinville Online Staff
Small business owners across Canada are calling for an extension to the deadline for repaying the Canada Emergency Business Account (CEBA) loan interest-free by the end of the year. According to a press release from the Canadian Federation of Independent Business (CFIB), 78% of small business owners believe that getting more time to repay their CEBA loan would increase their business’s likelihood of survival.
“Many small businesses are trying to repay their COVID-related debt while facing an onslaught of additional challenges,” said CFIB president Dan Kelly. “High-interest rates, inflation and labour costs are all making it hard for small businesses to keep their head above water, let alone make any dent in the debt they were forced to take on to survive pandemic restrictions. If the government helped ease their debt burden, small businesses could reinvest the money into employees or back in their business. Otherwise, we may see more business failures as businesses realize they can’t afford to stay open.”
CFIB data reveals that almost half (49%) of small businesses are still experiencing below-normal revenues, with those in the hospitality, arts and recreation, retail, and social services sectors hit the hardest.
CFIB is urging the federal government to extend the repayment deadline for the CEBA loan to the end of 2025 or at least the end of 2024. The organization is also calling for additional debt forgiveness and an appeal process for CEBA loan recipients who are now deemed ineligible. In the words of Corinne Pohlmann, Senior Vice-President of National Affairs at CFIB, “Given the uncertain economic situation and high debt loads, requiring repayment by end of this year may force many businesses to throw in the towel.”
A recent survey by CFIB shows that 72% of small businesses want to see the CEBA repayment rules extended, with 30% preferring a deferral of one year and 42% preferring two years. Unfortunately, only 10% of businesses that took on a CEBA loan have been able to repay it entirely, and another 47% say they will be able to repay it by the end of 2023.
CFIB has collected more than 19,000 petitions from small business owners calling for improvements to pandemic support, including the need to extend CEBA loans. Based on these petitions, CFIB has sent a letter to Deputy Prime Minister Chrystia Freeland and is sending letters to federal MPs, urging the government to ensure small businesses get the debt relief they need.
Small business owners can sign CFIB’s petition to extend the CEBA repayment deadline on their website.
