Small Business Financing in Canada

For most aspiring business owners, financing their start-ups can be quite challenging. Some of these entrepreneurs may not have all the money they need to launch the business as it is always difficult to secure a loan for a new business. However, if you are a Canadian resident, this should not worry you as it is now possible to secure a loan for a small business, thanks to the Small Business Financing Program. It is a loan program that involves the government in collaboration with other financial institutions.


You are eligible to apply for a loan under this program if you have a start-up or a small business within Canada that is operating for profit. The business should have a gross annual revenue of ten million dollars or less. Eligible businesses include; sole proprietorships, partnerships, cooperatives or corporations. However, farming businesses are not normally eligible as there is a similar program under Agriculture and Agri-Food Canada which targets such businesses. Other organizations that are not eligible include NGOs, religious and charitable organizations.

Loan Criteria

It is upon the lender and the borrower to negotiate the right amount to finance the business. However, the maximum amount that one can access under the program is one million dollars. As a set rule, the amount used for purchasing or improving equipment should not exceed $ 350, 000. A registration fee of two percent of the total loan amount is normally charged and the interest rate can either be fixed or variable.

The Application Process

To apply for the loan, you need to present your application together with the business plan to a credit union, caisse populaire or a chartered bank. Note that the financial institution can deny or approve the loan depending on whether you have met the requirements or not. Moreover, Industry Canada is not involved in the processing of the loan application or in the decision making process as this is purely the responsibility of the financial institution.

Different institutions have different criteria for approving these loans and if your application is denied by one financial institution, you can always try others.  This small business financing program has helped and continues to help start-ups and small business owners who would otherwise have no other option for financing their businesses.


If you would like to have direct control of your portfolio, then you should be thinking of becoming a self-directed investor within the financial market. But what do we mean by self-directed investing? This article seeks to explain facts about self-directed investing and to debunk some misconceptions surrounding

Self-directed investment can simply be understood as taking the responsibility and control of decisions regarding one’s investments. For many people, the idea of self-directed investing comes with myriad misconception and fears. However, the truth is that with the right information and basic knowledge in finance, a self-directed investor with a proper strategy can yield above average results and even outperform managed money.

To become a self-directed investor, one must open the self-directed investment account that allow investors to retains the authority to decide on the type of investment they want in their portfolio. For example, an investor can choose to have individual shares, Mutual funds or EFTs in his/her portfolio. This is contrary to managed accounts where such decisions are made by financial planners.

Many people believe that to be a self-directed investor, one needs “a lot of money”. Nothing can be farther from the truth. In Canada, one can self-direct any amount. For example, the Tax-Free Saving Account (TFSA) that allows Canadians over eighteen to deposit $5,000 per year can be self-directed. Using TFSA can be good starting point. With time, one can move a portion of retirement savings plan to a self-directed account without necessarily foregoing the tax deferral status.

Before opening a self-directed investing account, it is important to understand what one is getting into. Many Canadians experience fear when it comes to making their investment decisions. This is due to lack of knowledge of what finance markets entail and the great potential that is there. Many people think that trading in securities is gambling. This is not true! Just ask any successful trader; you will never hear the term gambling in the description of what their activities entail.

The main advantage of a self-directed investment is that an investor will benefit from greater capital appreciation, increased liquidity and reduced fees. However, there is a major drawback in that a self-directed investor may suffer from emotional stress. Many people also lack the patience, the knowledge and the discipline necessary to be a successful self-directed investor.

In conclusion, it is apparent Canadians have the opportunity to be self-directed investors. However, it is important to understand what self-directed investment entails and maintain the necessary discipline to be successful.