Fri. Mar 1st, 2024

Businesses must repay their 'COVID loan' | COVID-19: everything about the pandemic

Open in full screen mode

Justin Trudeau persists: there will be no extension of the reimbursement deadline.

  • Philippe Granger (View profile)Philippe Granger

Voice synthesis, based on artificial intelligence, allows you to generate spoken text from written text.

The time has come for the hundreds of thousands of businesses and organizations that have taken out loans related to the COVID-19 pandemic under a Government of Canada program.

The deadline for repaying loans from the Canadian Emergency Business Account (CEBA), established by the federal government to help businesses weakened by the effects of the pandemic, is Thursday.

Up to one third of the loan could be forgiven if the outstanding amount is repaid by this Thursday, otherwise, the debt will be converted into a loan on the full amount at 5% annual interest over three years (to be repaid by December 31, 2026).

A repayment can also be deferred until March 28, 2024 if a refinancing request was made between the company and its financial institution before January 18.

The Canadian Emergency Business Account (CEBA), summary

COVID-19: everything about the pandemic

Consult the complete file

COVID-19: all about the pandemic

View full file

FollowFollow

If we take the example of a business that obtained a loan of $60,000, this business will be able to obtain loan forgiveness of $20,000 if it manages to repay $40,000 by Thursday. She will also be able to obtain a rebate of $20,000 and repay the government by March 28, 2024 if she has concluded a refinancing request with her financial institution. Otherwise, if she has not repaid anything by Thursday, she will have to repay the government by December 31, 2026 for $60,000, with 5% annual interest.

< p class="StyledBodyHtmlParagraph-sc-48221190-4 hnvfyV">The Canadian Federation of Independent Business (CFIB) is greatly concerned by the situation. She estimates that, as of December, 35% of businesses had repaid their loans, about 40% had not yet repaid but were going to be able to do so, and 22% said they were simply unable to repay their loans. ready. The CFIB estimates that many businesses will be weakened, or even bankrupt, because of these delays.

EP1040.BALADO.That explains it.

EP1040

BALADOThat explains it

Listen to the audio (EP1040. 18 minutes 7 seconds)

Very many businesses, many chambers of commerce, the 13 provincial and territorial premiers, the NDP and the Bloc Québécois are requesting an extension of the deadline for repayment of this loan, sometimes nicknamed COVID loan

Requests for extension of the deadline have until here been refused by the federal government.

Tuesday, in front of 650 business people gathered in Montreal at the invitation of the Chamber of Commerce of Metropolitan Montreal, the Prime Minister of Canada, Justin Trudeau was very clear: After the most intense period of COVID, there are other challenges. We have already extended this aid twice, but at a certain point, it is time that we continue to move forward.

Open in full screen mode

Prime Minister Justin Trudeau made this statement during an event organized by the Chamber of Commerce of Metropolitan Montreal. (File photo)

The Office of the Parliamentary Budget Officer estimates that extending the deadline by one year would have cost $907 million dollars to taxpayers.

CFIB is calling on the Government of Canada to establish a multi-year repayment plan for beneficiaries who were deemed ineligible after receiving their loan and to ensure that those who were mistakenly designated ineligible do not lose not the subsidy portion of the CEBA.

The government would have been better advised to give a little more time. […] The government risks not recovering as much money as it wants by being in too much of a hurry, predicts Jasmin Guénette, vice-president of National Affairs at the CFIB, on the airwaves ofTout un matin , on ICI Première. There are many who feel too tight to make it happen.

The government wants to turn the page, but he turns it too quickly. […] He often says that he supports SMEs. He had the opportunity to do it, but it was a missed opportunity on his part.

A quote from Jasmin Guénette, Vice-President of National Affairs at the CFIB

Open in full screen mode

Jasmin Guénette believes that a postponement of the deadline is necessary. (File photo)

Disappointment and anxiety are felt among entrepreneurs. Frédérique Marseille, general director of the Backbone climbing center in Bromont, shared her frustration on the show Tout un matin, on ICI Première.

The entrepreneur says she is particularly disappointed that the hot potato is being sent to financial institutions, which are not there to save small businesses, but rather to capitalize.

Open in full screen mode

Frédérique Marseille, owner of the Backbone climbing center, in Bromont. (Archive photo)

Frédérique Marseille says she was pushed towards the private sector and felt the knife in her throat when her financial institution contacted her on January 10 to offer a loan to high interest rate (10.65%), also committing her to personal guarantees which would force her to pay out of her own pocket in the event of being unable to repay the loan.

In our eyes, the government looked good during the pandemic by doing whatever it could to save its citizens, but we are still in it. [The government has] launched this in the courtyard of the institutions, but the institutions are not giving us any gifts.

A quote from Frédérique Marseille, general director of the Backbone climbing center in Bromont

< p class="StyledBodyHtmlParagraph-sc-48221190-4 hnvfyV">Finally, Frédérique Marseille's company signed this loan, which the entrepreneur immediately perceived as a gamble, not having the certainty that an extension from the government was really ruled out. She estimates that by doing this, her business saves $10,000.

Ms. Marseille, who runs a family business, is saddened also that we put all SMEs in the same basket.

The word "SME" is very very wide. […] Not all SMEs in Canada have experienced the pandemic in the same way. We are a small service business in indoor sports and catering, so we have certainly experienced the pandemic in a very difficult way, and we are still experiencing the repercussions to the fullest.

With information from The Canadian Press, Andrée-Anne St-Arnaud, Tout un matin, Marie-Ève ​​Arsenault and Yannick Lepage

  • Philippe Granger (View profile)Philippe GrangerFollow< /li>

By admin

Related Post