Struggling businesses in Surrey, B.C., ask Ottawa to extend pandemic loan repayment deadline
CBC
The Surrey Board of Trade says it is urging Ottawa to again extend the fast-approaching repayment deadline for emergency pandemic loans it says many small businesses won't be able to repay without shuttering.
President and CEO Anita Huberman says around 600 businesses in Surrey, southeast of Vancouver, most with only a handful of employees, are already struggling in a "perfect storm" of rising costs, supply chain delays and labour shortages.
And with the deadline to repay the Canada Emergency Business Account (CEBA) loans looming in December, "another ingredient in the perfect storm is about to arise as we are facing the 'great opportunity' to repay their loan that they can't repay at this time," Huberman told CBC.
"Everything is on the line right now in terms of bottom-line profitability."
About 890,000 small businesses and non-profits across Canada received more than $49 billion in loans through the CEBA program, according to a spokesperson for the federal finance ministry.
The interest-free loans, administered by private banks but guaranteed by the federal government, provided up to $60,000 to eligible businesses for pandemic adaptations and personal protective equipment, and were originally due to be repaid on Dec. 31, 2022.
Last year, Ottawa extended the deadline by one year to Dec. 31, 2023, in order for the business to qualify for up to a third of the loan to be forgiven and pay no interest.
But if businesses can't pay in full by the end of this year, they will no longer be eligible for any forgiveness and will need to repay the total by Dec. 31, 2025 with five per cent interest added on top.
Huberman says extending the deadline for full, interest-free repayment to December 2025 could be the difference between a business shuttering or surviving.
"It would mean the opportunity for businesses to be able to save money, to repay that loan, to be able to make money," said Huberman.
Many businesses, including in retail, arts and culture, and manufacturing are still not back to pre-pandemic levels of business and profit margins, she added.
In a statement to CBC News, a spokesperson for the federal finance ministry declined to comment on whether the deadline would be extended again.
"When the COVID-19 pandemic hit, the federal government acted swiftly to provide emergency support and ensure that Canadians and Canadian businesses could weather the storm," said Katherine Cuplinskas, noting the original one-year extension.
"This programme was central to ensuring Canadian small businesses were able to not only survive the pandemic but thrive in the recovery."
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