Majority Of Small Businesses In Large Debt

Small businesses have not made a dent in the COVID-related debt they’ve taken on, owing an average of nearly $170,000, says the Canadian Federation of Independent Business (CFIB). It estimates that small businesses in Canada now owe a collective $139 billion due to COVID-19, up from the estimated $135 billion in February. Three quarters (76 per cent) of small businesses that took on debt say that it will take them more than a year to repay and 87 per cent of businesses in the hospitality sector estimate it will take at least two years. However, for businesses to avoid accumulating more debt, CFIB calls on the government to implement provincial ‘stay open’ strategies that make avoiding future lockdowns and business closures a top priority, maintain support programs and subsidies until the entire economy can reopen, extend the repayment term for the Canada Emergency Business Account (CEBA) loan to December 31, 2024, and provide additional rounds of funding through provincial grant programs.