Winnipeg business advocates join calls to extend pandemic business loan deadline

Business improvement advocates from Winnipeg are joining calls made across the country to extend deadlines for a federal government pandemic loan repayment.

Members of Canada's International Downtown Association headed to the nation's capital on Monday to urge federal politicians to push back the Canadian emergency business account (CEBA) repayment deadline.

Kate Fenske, CEO of Downtown Winnipeg BIZ and chair of the International Downtown Association, said the looming deadline is causing undue stress and worry among downtown business owners in Canada as they struggle to recover from the pandemic's impacts.

"We're hearing from businesses regularly that with those CEBA loan repayments coming due, they just don't know if they're going to make it," Fenske told CBC's Information Radio on Monday.

"We know it's going to be so much harder to get businesses and jobs back if we lose them."

The CEBA loan launched in April 2020 to offer zero-interest loans of up to $60,000 to Canadian small businesses struggling during the COVID-19 pandemic. Up to $20,000 would be forgiven if $40,000 was paid by a certain date.

But with the Jan.18, 2024, repayment deadline looming, businesses across Canada are at risk of closure, Fenske said.

"The measures they did put in place were so critical to keep businesses alive during the pandemic, but it just hasn't been enough time for them to bounce back," said Fenske, who joined downtown leaders from Montreal, Victoria, Halifax, Toronto and Edmonton at Parliament Hill to call for a one-year extension of the deadline.

"Many of them are still trying to stay afloat and trying to make ends meet."

The federal government moved the deadline from Dec. 31 to Jan. 18 in September. The deadline moves to March 28 if businesses make a refinancing application before Jan. 18 with the financial institutions that provided the CEBA loans.

But Fenske said the extension falls short.

"The extension of the federal government did announce previously was only 18 days, and that's just not enough that businesses can survive," she said.

Once Jan. 19 hits, all outstanding loans will have to be repaid in full by Dec. 31, 2026, and will be subject to interest. That deadline was originally set for the end of 2025.

High interest rates

If the Jan. 18 deadline isn't extended, Fenske said business will likely take out more loans, which will likely have high interest rates.

"It's going to be a real challenge for many businesses out there," she said.

Winnipeg Chamber of Commerce president and CEO Loren Remillard also wants to see the Jan. 18 deadline extended by at least one year.

He said the federal government needs to recognize that businesses are still in "recovery mode" and are facing cash flow problems, rising labour costs and inflation.

"Another year would allow those businesses to be able to continue to manage their cash flow, be able to drive some revenue, to be able to start making those payments back where it doesn't cause them to have to cut back," he told CBC.

Remillard also said the government should just recognize the $20,000 forgivable portion.

"Don't make businesses have to borrow — at elevated interest rates — money to be able to pay back the loan to be able to access a forgivable portion," he said.

"That would go a long way to help businesses get through this very difficult time."

With close to 900,000 Canadian businesses using CEBA , totalling nearly $49 billion in loans, Remillard said it's vital the government steps up — especially as downtown businesses face their own set of pandemic recovery struggles.

"For those small businesses in the downtown, they have a little bit of an additional challenge that their revenues have not returned to pre-pandemic levels," he said.

"If we're serious about supporting the hearts of Canada's cities, CEBA is a big part of addressing that."

All 13 provincial and territorial premiers asked Ottawa to extend the Jan. 18 deadline by a year in an Oct. 20 letter to Prime Minister Justin Trudeau.

In a previous email to CBC, Katherine Cuplinskas, a senior communications advisor and press secretary to Finance Minister Chrystia Freeland, said the recent extensions offer businesses "additional flexibility."