Canada Emergency Business Account and Regional Relief and Recovery Fund Business Supports

Issue

The economic rebound for many industries impacted by business restrictions from 2020-2022 has been slower than anticipated, and full repayment of the Canada Emergency Business Account (CEBA) and Regional Relief and Recovery Fund (RRRF) loan by December 31, 2023 is not feasible for many Alberta businesses.

Background

Over 125,000 businesses in Alberta were approved for Canada Emergency Business Account (CEBA) and over 4,500 businesses under Western Economic Diversification Canada were approved for Regional Relief and Recovery Fund (RRRF) loans to assist with operational expenses at a time when business restrictions impacted revenues. 

The repayment deadline for the loans was extended to December 31, 2023 in order for a business to qualify for the “forgivable” portion of their loan. In October of 2022, 30% of businesses surveyed said it would be a challenge to repay the funding received.209 Further, small businesses were more likely to expect a challenge repaying government support than larger businesses. It is estimated that between 25%-42% RRRF loans would not be repaid.

Our Recommendations

1. Advocate on behalf of businesses that the Government of Canada: 
   1. Extend the non-forgivable CEBA and RRRF repayment deadline to December 31, 2025, and announce this extension officially before September 30, 2023. 
   2. Require principal-only payments, on a monthly basis, for the outstanding balance of the loan commencing on January 1, 2024, with the balance of the loan repaid no later than December 31, 2025. 
2. If the Government of Canada does not extend the repayment deadline for the non-forgivable portion of the CEBA or RRRF loan (by September 30, 2023), the Government of Alberta (via the Alberta Treasury Branch and credit unions) will provide “bridge financing” to businesses that meet the required criteria.