TORONTO, Jan. 26, 2021 /CNW/ - Many businesses in Canada continue to face significant challenges related to the coronavirus pandemic, putting pressure on our economy, communities and households. Some sectors have been particularly hard hit and disproportionately affected by COVID-19.
Banks in Canada are working with the Government of Canada to deliver relief to these businesses through the Highly Affected Sectors Credit Availability Program (HASCAP) Guarantee. The program offers 100 per cent government-guaranteed financing for heavily impacted businesses, including those in sectors such as tourism and hospitality, hotels, arts and entertainment. Under HASCAP, eligible businesses can apply for loans between $25,000 and $1 million over terms of up to ten years at a fixed annual interest rate of four per cent. Eligible businesses can also request to postpone principal repayments for up to 12 months at the start of the loan. Businesses must have applied for and received subsidies for at least three months under the Government of Canada's Canada Emergency Wage Subsidy or the Canada Emergency Rent Subsidy programs and have experienced a minimum 50 per cent revenue decrease for at least three months. Eligibility criteria and thresholds for revenue decline are established by the Business Development Bank of Canada (BDC) and financial institutions will apply the necessary origination, credit approval and administration processes for each applicant. Financial institutions will begin accepting applications as early as next week, and businesses are encouraged to check the website of their primary institution for details about the program's availability.
"Canada's banks and the federal government are here to support our hardest-hit businesses, bridge them through the crisis and help pave the way to a stronger future," said Neil Parmenter, President and CEO, Canadian Bankers Association. "The sectors targeted through HASCAP are important to Canada's economy and will help drive future growth. Just as they have through existing relief programs, banks are standing by Canadian businesses and households to position them for a strong, sustainable recovery."
HASCAP comes in addition to collaborative efforts by government and banks to support businesses through the Business Credit Availability Programs, including the newly expanded Canada Emergency Business Account (CEBA), the Export Development Canada Guarantee Program and the BDC Co-Lending Program. Financial institutions have enrolled almost 820,000 Canadian businesses in CEBA, representing more than $41 billion in interest-free credit for eligible businesses. Banks have also introduced a range of flexible measures for existing loans, including deferrals and term extensions. More than 89,500 deferrals have been extended to business accounts for SME, commercial and corporate customers with a total value of more than $3.3 billion.
Learn more about how Canada's banks are standing by Canadians: cba.ca/canadian-banks-are-standing-by-canadians
About the Canadian Bankers Association
The Canadian Bankers Association is the voice of more than 60 domestic and foreign banks that help drive Canada's economic growth and prosperity. The CBA advocates for public policies that contribute to a sound, thriving banking system to ensure Canadians can succeed in their financial goals. www.cba.ca.
SOURCE Canadian Bankers Association
Mathieu Labrèche, Director, Media Strategy, (416) 918-2777, [email protected]
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