Due to the September 14, 2023 government announcement regarding changes to the CEBA program, we are in the process of updating our website and cannot guarantee the accuracy of all the information currently displayed on this page.

The CEBA loan program’s repayment deadline is coming. Set for December 31, 2023, small businesses can take advantage of up to $20,000 in loan forgiveness, but only if they repay their loan in full by the deadline. For many Canadian small businesses still recovering from the effects of the pandemic, this is easier said than done.

To help small businesses qualify for loan forgiveness, OnDeck Canada created the CEBA refinancing program. Read on to learn more about how the program works so you don’t miss out on this time-sensitive opportunity to save your business thousands of dollars.

A Look Back at the CEBA Program

The Canadian government introduced the Canada Emergency Business Account (CEBA) to support small businesses affected by Covid. It provided interest-free loans of up to $60,000 to eligible businesses to help them cover their daily operational expenses. Originally set to expire on December 31, 2022, the repayment deadline was extended to the end of 2023, to provide SMBs with some much-needed breathing room. With no updates on further extensions when the government tabled its budget in March, many believe that it is unlikely that the deadline will be pushed a second time.

Breaking Down CEBA Loan Forgiveness

Loan forgiveness was built into the CEBA program to encourage full repayment by the deadline and to help ease the financial burden on small business owners looking to avoid incurring interest charges. To qualify, businesses must meet the following criteria:

  • Your eligibility for the Canada Emergency Business Account (CEBA) has been validated by the Government of Canada and the Canada Revenue Agency.
  • Your business is in good standing with the financial institution that funded your CEBA loan.
  • Your outstanding balance is repaid in full on or before December 31, 2023.

The percentage of loan forgiveness is based on your loan amount. Here is a breakdown of those percentages:

Outstanding balance of $40,000 or Less. Repaying your outstanding balance will result in loan forgiveness of 25%, up to $10,000.

Example #1: If your outstanding balance is $30,000, you only need to repay $22,500, receiving $7,500 in loan forgiveness.

Example #2: If your outstanding balance is $40,000, you only need to repay $30,000, receiving $10,000 in loan forgiveness.

Outstanding balance above $40,000. Repayment of the outstanding balance will result in loan forgiveness of 25% on the first $40,000 plus 50% on the amount above $40,000.

Example #1: If your outstanding balance is $50,000, you only need to repay $35,000, receiving $15,000 in loan forgiveness.

Example #2: If your outstanding balance is $60,000, repayment will result in loan forgiveness of 33%, or $20,000.

OnDeck Canada’s CEBA Refinancing Program

If you’re worried about the immediate impact on your cash flow, our CEBA Refinancing Program extends your repayment timeline. Rather than paying down your CEBA loan balance as a lump sum, you can make smaller repayments over a longer period of time. This will allow you to preserve your working capital while maximizing savings with loan forgiveness.

We understand that small businesses have unique needs, so we offer three financing options to choose from:

1. Line of Credit: Our Line of Credit lets you borrow up to a limit and pay it back over time, with weekly fixed or variable repayments. Funds are deposited directly into your business account.

2. Fixed Term Loan: With a Fixed Term Loan, you receive the full financing amount up front and repay it with fixed installments (daily or weekly) over a specified term.

3. Flex Funds: Flex Funds is an advance product that gives you the full amount of financing up front and is repaid with variable, daily payments using a small percentage of your daily card sales.

Steps to Qualify for Loan Forgiveness

Take full advantage of the CEBA loan forgiveness program. Here’s a guide to help you get started:

1. Check Your Eligibility: First, make sure your business meets the CEBA eligibility criteria. Your business needs to be in good standing with the financial institution that funded your loan.

2. Review Your Outstanding Loan Amount: If you’re not sure where your balance stands, contact your financial institution to determine your outstanding CEBA balance.

3. Understand Forgiveness Criteria: Get familiar with the loan forgiveness criteria based on the amount you received.

4. Explore Repayment Options: Explore your options and choose the one that best suits your business while protecting your short-term cash flow.

5. Crunch the Numbers: Determine how much you need to pay back, how much you’re eligible to save, and if you choose to refinance your CEBA loan don’t forget to factor in any additional lending costs. The goal of our CEBA Refinancing Program is to ensure you have the breathing room you need while still netting savings from loan forgiveness.

6. Meet the Deadline: Complete the repayment process by December 31, 2023, to be eligible for loan forgiveness.

If you don’t pay before December 31, 2023, you’ll have to repay the full amount borrowed plus 5% interest per year, charged monthly. The principal is due in full by December 31, 2025.

How to Apply for Financing

To be eligible for OnDeck Canada’s CEBA Refinancing Program, your small business should meet the following minimum criteria:

  • Business must be based in Canada.
  • Must have a business bank account with a Canadian financial institution.
  • Must have a business history of at least six months with you as the business owner.
  • Must make a minimum of $100,000 in annual sales.

If you’re interested in our CEBA Refinancing Program, click here to see how much your business qualifies for. Applying is 100% risk-free and will not impact your credit score.

Don’t let Your CEBA Loan Weigh you Down

Let’s work together to find the best solution for you and your business. Act now to explore your eligibility, understand loan forgiveness criteria, and take advantage of our CEBA Refinancing Program before the December 31st deadline. Need more information about our financing options? Get in touch with our Lending Advisors at (855) 704-7458 Monday through Friday from 9 a.m.-6 p.m. ET.