More farmers are expected to benefit after the federal government on Monday announced that businesses that have been operating out of a non-business banking account can now access the Canada Emergency Business Account (CEBA) by opening a business account.
“This has been an important ask from farmers and will help ensure the financial strength of the thousands of small agricultural businesses across the country,” federal Agriculture Minister Marie-Claude Bibeau said in a statement.
Effective Monday (Oct. 26), the government said CEBA will be available to businesses that have been operating out of a non-business banking account. To be eligible, businesses must have been operating as a business as of March 1, 2020, must successfully open a business account at a Canadian financial institution that is participating in CEBA, and meet the other existing CEBA eligibility criteria.
The deadline to apply for CEBA is Dec. 31, 2020.
CEBA provides zero-interest loans up to $40,000 to small business and non-profit organizations that have experienced diminished revenues due to COVID-19 but face ongoing non-deferrable costs, such as rent, utilities, insurance, taxes, and wages. Repaying the balance of the loan on or before Dec. 31, 2022 will result in loan forgiveness of 25% (up to $10,000).
Not counting the number of farmers who are now eligible because of the change announced today, over 85,000 farm businesses will have access to the interest-free loans of CEBA, which equates to up to $5.1 billion – one-third of which is forgivable. That means there is the potential of providing up to $1.7 billion directly to farmers through the forgivable portion of their interest-free loans.
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