Operating a small business is not an easy task during the COVID-19 pandemic. Readjusting your costs and downsizing are a few of the difficult but necessary choices to make in order to navigate through an uncertain market. Some industries, like the events and photography ones are left paralyzed due to cancellations, and the demand for products and services are reduced across the board.

We’ve gathered a few short-term financial solutions to help you and your business keep your cash flowing – just enough to stay operational until we can finally reach a “new normal”.

1.      CERB – Canada Emergency Response Benefit

This is a taxable benefit providing $2000 per month for up to four months for workers who lose their income as a result of the COVID-19 Pandemic.

They are for individuals that:

• Have lost their job / were laid off
• Are sick with COVID-19
• Are quarantined
• Are taking care of someone who is sick with COVID-19
• Are working parents who must stay home (without day to care) for children who are sick or at home due to school and daycare closures.

It also applies to:

• Applies to wage earners and contract workers, and self-employed individuals who would not otherwise be eligible for Employment Insurance (EI)
• Workers still employed but not receiving income also qualify

How it works

1. Apply online through your Canada Revenue Agency account or by calling.
2. CERB payments are received within 10 days of application.
3. You may be asked to return or repay your CERB payment if you are found not eligible and have already received payment.

Learn more about the CERB and if you are eligible here: https://www.canada.ca/en/services/benefits/ei/cerb-application.html

2.      CEWS – Canada Emergency Wage Subsidy

Subsidy provided by the government to Canadian business owners whose business has been affected by COVID-19. The government will cover 75% of employee wages for up to 24 weeks, starting between March 15^th to August 29^th, 2020.

• It is paid by direct deposit within 3-5 business days, or by cheque to the employer.
• Expect Mailed cheques to take a few days longer to arrive.
• You may also be asked to return all or part of the subsidy if you were deemed unqualified after the payment was made.

Learn more about your eligibility as an employer, how to calculate your subsidy amount and how to apply here: https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html

3.      PME Montreal

They are a Montreal organization providing financial support for entrepreneurs and small to medium businesses of all kinds.

A.      Emergency Assistance to SME’s

• Loan for enterprises from all sectors, social economies, cooperatives and non-profit enterprises. The financing must provide short-term working capital to businesses whose financial situation is precarious so they can maintain, consolidate or relaunch their activities.
• Businesses must provide all the documentation required for assessment for eligibility.

The financial aid will take form as a loan reaching up to $50 000.000 at an interest of 3%.

Brief list of Requirements

• Be active in Quebec for less than a year
• Temporarily closed or may soon close
• Can demonstrate a cause-effect between financial and or operational problems with COVID-19
• Must not be under the protection of the Companies’ Creditors Arrangement Act (R.S.C., 1985, c. C-35) or the Bankruptcy and Insolvency Act (R.S.C., 1985, c. B-3)
• Must be an eligible business
• Other documents will be required to provide for profitability and eligibility analysis by PME MTL
• You must also submit an official application form provided on the PME’s Emergency Assistance Webpage

For full details on this loan: https://pmemtl.com/en/centre/services/financing/loans-and-subsidies/emergency-assistance-sme-covid-19

B.      Fonds Entrepreneurial Commercial

Available funding for an entrepreneurial or development project in retail businesses.

Provides a grant of up to $25 000.00. The grant must not exceed 25% pf the total cost of the business project.

Eligibility

• Applicant must be a Canadian citizen or permanent resident
• Legally incorporated and registered in the Quebec Enterprise Register (REQ)
• Be established in Montreal with a head office in Quebec
• Submit a business plan or project summary, current or projected financial statement and any other document deemed relevant
• Demonstrate that the business brings added value to the existing retail offer
• Provide a minimum cash down of 20% of the total project value, which cannot be less than $5 000

For full details on this loan follow this link: https://pmemtl.com/en/centre/services/financing/loans-and-subsidies/fonds-entrepreneuriat-commercial

PME MTL also provides financial support for young businesses and entrepreneurs, social development projects, sustainable industrial development projects and many more!

For a full list of loans and funds from PME MTL, select your area and click on “Funds” here: https://pmemtl.com/en/financing

4.      BDC Funds and Loans for Small Businesses

A.      CEBA – Canada Emergency Businesses Account

These are government issued funds provided to small to medium business owners, in collaboration with Export Development Canada. Loan amounts can go up to $40 000.00 for small businesses and Not-For-Profits.

To apply, the borrower must:

1. Contact an eligible financial institution
2. Make sure you meet all the eligibility requirements for the loan
3. Make sure to use the CEBA funds appropriately (to pay non-deferrable operating expenses including payroll, rent, utilities, insurance, property tax, etc.  – and not for prepayment or refinancing of existing indebtedness, dividends, nor increases in management compensation.)
4. Agree to participate in post-funding surveys conducted by the Gov. of Canada or its agents.

For full details on this loan follow this link: https://ceba-cuec.ca/

B.      BDC Co-Lending Program & EDC Business Credit Availability Program (BCAP) Guarantee

This program is complex but can still prove useful to fund cash flow, operations and liquidity needs of small to medium enterprises.

Here’s a snapshot from their website to summarize these funds:

The full document and description for these loans can be found here: https://www.bdc.ca/en/documents/special-support/BCAP-program-overview-external.pdf

5.      RRRF – Regional Relief and Recovery Fund

Provides Emergency financial relief for SME’s and NPO’s that are unable to access other federal programs or denied assistance under these programs, in order to help them stay in business.

This fund is supposed to help when you do not qualify for the major relief funds and emergency benefits or have not benefitted from federal government relief measures.

They will be in the form of direct or indirect emergency funding aimed at helping these businesses – if they lack liquidity and cash flow to remain in business. It is a one-time target payment initiative.

Loans of $40 000 or less are provided to most applicants and must be repaid according to a schedule provided. If 75% of the loan is repaid by Dec. 31^st, 2022, the remaining 25% does not need to be repaid. Otherwise, the entire loan is considered repayable over a 3-year period, starting Jan. 1st, 2023.

For-profit businesses with annual sales of $250 000 and above can apply for loans of $40 000 or more.

Authorized recipients are businesses, co-operatives, not-for-profit organizations, business support organizations, and indigenous organizations.

Authorized costs include costs that help stabilize the SME’s and organizations and mitigate the impact of COVID-19, which were not fully covered by other federal relief measures. (Ex: equipment and machinery rental or leasing, wages and benefits, property taxes, insurance, etc.)

Need of assistance must be solely related to an immediate (one-time) financial pressure on liquidity and must be a consequence of COVID-19. It must be for a max. of 6 months, up until December 31^st, 2020.

2.      SimulAide & Other program eligibility calculators and tools

SimulAide is an online tool to assess whether you would be eligible for last-resort financial assistance. It uses the information you provide by answering a series of questions and identifies which aid sources you can seek. However, it does not indicate the amount of assistance for which you qualify. Note that only Quebec residents are eligible for financial assistance form the QC Government.

Here is the simulation page: http://www.simulaide.emploiquebec.gouv.qc.ca/index.php/728252

How to apply: https://www.quebec.ca/en/family-and-support-for-individuals/financial-assistance/social-assistance-social-solidarity/how-to-apply/

Financial Assistance amounts: https://www.quebec.ca/en/family-and-support-for-individuals/financial-assistance/social-assistance-social-solidarity/calculating-basic-benefit/

Finally, on the Quebec Government Website, there is another tool to identify which government assistance programs you would be eligible for during COVID-19. Click here to access this simulation assessment: https://www.quebec.ca/en/programmes-aide-gouvernementaux-covid19/

That sums it up!

This sums up all the main funds and loans available to support entrepreneurs and small to medium businesses in Montreal. As you can see, there are many programs aimed at reaching all the different income groups, so hopefully you can find the solution to best suit your emergency business needs during this pandemic. Montreal is a city that supports it’s local business community; whether its from the government, from public organizations, banks, or even look to your friends and family – We come together to make sure we all get through this. Ça va bien aller!