On September 14, 2023, revised terms and deadlines were announced for the Canada Emergency Business Account (CEBA) loan program by the Government of Canada.
We are continuing to communicate with government officials and stakeholders to voice concerns the changes do not adequately address the severity of the financial strain our member companies are experiencing.
Under these new terms, businesses with federal government loans under the CEBA program must make repayment arrangements with their lending financial institution before January 18, 2024, or the current CEBA loan will be subject to a three-year repayment plan at 5% interest per year, and lose the forgivable portion offered by the government.
In brief, businesses have been provided with a few scenarios and the following terms:
- CEBA loan holders must have started the refinancing process with the lending financial institution by January 18, 2024, or those businesses are immediately subject to three-year term loans at 5% interest.
- CEBA loan holders can still achieve the forgivable portion (up to $10 or $20K depending on the principal amount of the loan), if the loan refinancing process begins by January 18, 2024, and the loan is paid back in full by March 28, 2024.
- Businesses who refinance but don't pay back the loan in full by March 28, 2024, will still receive the preferrable 5% annual interest rate on the loan, which must be paid back in full by December 31, 2026. This scenario means loan holders who remain in repayment after March 28, 2024, will not be eligible for the forgivable amount.
- Loans not fully repaid by March 28, 2024 will incur interest at 5% for a three-year period. Loan holders may have the option of making monthly payments equal to the interest portion during this period with the balance of the principal amount, coming due on December 31, 2026.
- The above changes to the CEBA program also apply to the CEBA-equivalent lending through the Regional Relief and Recovery Fund (RRRF).
TIAC has made significant efforts to actively amplify your concerns around CEBA repayment directly with the government. We would like to highlight that we were not consulted on the details of this announcement prior to its release by the Prime Minister and Finance Minister. Nor were our coalition members. The Minister of Tourism did not share the details of the announcement in advance of its release. TIAC has been in contact with the Minister’s office and government officials as we work through next steps and alternative support for the tourism sector. We will continue to provide pertinent information as it is learned.
Should you have any questions, please don't hesitate to reach out.
Please feel free to refer any media calls to Michel Boyer, Senior Director, Communications and Media Relations ().
President and CEO
Tourism Industry Association of Canada