The federal government has asked the small businesses who have availed the CEBA loans to pay back the loan by Jan 18. This Canada Emergency Business Account Loan was provided to the small businesses to meet their financial crisis during the pandemic. Many small businesses opted for the business loan as a solution to run their business instead of closing it because of losses. However, now these businesses (around 23%) are unable to pay back their loan on the given repayment deadline. This has been reported by CFIB, Canadian Federation of Independent Business. 

The CFIB has been receiving many calls from these businesses stating that they might not be able to pay back the business loans in time. CEBA was an interest free loan and the businesses were allowed to get $40,000 as loan. This loan now if not paid in time will not remain interest free. The businesses will have to pay 5% interest on the loan amount and they will have to pay back the complete amount in three years. The payment will have to be done in monthly installments starting immediately.

Many business owners have been sharing their concerns regarding this deadline. One such business owner is Peggy Berndt. She owns a cell phone repair store named CellClinic.ca. She has written a letter to the federal and local politicians asking them to provide financial aid via Canada’s Disaster Assistance Program. This aid is used during large scale natural disaster and COVID should also be considered one. It has widely affected the small businesses making them suffer huge losses. The policy analyst, Emily Boston from CFIB said the small businesses have around $100,000 as debt on an average. Most of them are struggling to pay back in the current economic climate. The loan which was initially offered to help businesses survive might now compel them to close for good.