CEBA loans: repayment extension for some, notices of ineligibility for others

In October 2022, financial institutions began sending out notices to CEBA loan recipients confirming a new repayment deadline and advising others that they have been deemed ineligible for the loan in the first place. Many small business owners have called us to ask if these messages are legitimate, and we can confirm they are.

Loan Repayment Extension

For most of the 900,000 CEBA loan recipients, the news is positive. Governments and financial institutions are simply confirming that businesses have an additional year to repay their interest-free loans. Instead of repaying CEBA loans by December 31, 2022, small businesses that remain eligible for CEBA have until December 31, 2023. CFIB requested this extension given the length of pandemic restrictions and was pleased that government listened.

Ineligible Businesses to Lose Loan Forgiveness

About 50,000 loan recipients will receive emails that they were not eligible for a CEBA loan in the first place. These businesses will still have until December 31, 2023, to pay back the full amount, but will lose the forgivable portion. The government has communicated that this is a final decision with no pathway for reconsideration or more information. CFIB regards this as deeply unfair and urges affected businesses to join us in pushing back (see section below).

Applications for Expanded CEBA Loans

Another group of business owners will receive emails that they are not eligible for the CEBA expansion of an additional $20,000 loan (to a total of $60,000). These businesses will continue to keep their $40,000 CEBA loan with the forgivable portion should they pay it back by the end of 2023.

Businesses unable to pay back the CEBA loan by the end of 2023 will have the CEBA loan converted into a two-year term loan at 5% interest and will have to pay the full amount (either $40,000 or $60,000) of their loan. There will be no forgivable portion if the CEBA loan is repaid after the end of 2023.

CFIB efforts

Throughout the pandemic, the government made changes to its programs to address the changing nature of the pandemic. Small businesses were pleased government listened to earlier CFIB advice by allowing all CEBA recipients to repay the loan by the end of 2023, rather than the earlier deadline of December 31, 2022. At this stage, these decisions are final, but CFIB is urging government to:

• Ensure all CEBA loan recipients who received it in good faith but are now deemed ineligible get to keep the forgivable portion if they repay the loan by the end of 2023
• Increase the forgivable portion of all CEBA loans to at least 50%
• Extend the repayment deadline of the CEBA loan for an additional year to December 2024

How you can help CFIB

Did you receive an email saying you were ineligible for the CEBA loan or not receive any email from your financial institution at all?

1. Sign our petition,
2. Share your story with our Business Advisors at 1-833-568-2342 or cfib@cfib.ca,
3. Contact your MP with your concerns, and
4. If you are comfortable with it, speak to the media.

FAQ

Who can I contact with my questions?

For questions regarding specific loan details or repayment, please contact your financial institution directly.

To find out why you have been deemed ineligible, call the CEBA Call Centre at 1-888-324-4201.

Call center operating hours: Monday-Friday, 9am-6pm ET, excluding statutory holidays.

The CEBA call center is unable to grant exceptions to CEBA eligibility criteria. CEBA eligibility was determined based on the criteria established by the Government of Canada.

All outcomes are final, but if you feel your situation is unfair or you have not received any communication from your financial institution please share your story with our Business Advisors at 1-833-568-2342 or cfib@cfib.ca and talk to your MP.

Am I eligible for the repayment loan repayment extension (to December 31, 2023)?

If you met the eligibility criteria and are in good standing, then you will be eligible for the repayment extension. Your financial institution will contact you with details regarding the new payment date.

Do I qualify for loan forgiveness?

If you met the eligibility criteria and are in good standing, you will be eligible to receive forgiveness on a portion of the loan, providing the balance is paid in full on or before December 31, 2023.

How can I find out the balance of my loan?

Your financial institution will be able to provide details regarding the balance of your loan.

How much of my CEBA loan do I need to repay?

You will receive information from your financial institution regarding repayment terms and associated forgiveness. If you have further questions, please contact your financial institution.

How can I repay my loan?

Please contact your financial institution for information on how to make payments.

Do I still have to repay the loan even if my business is about to close?

Yes. All recipients of the CEBA loan are expected to repay the loan in accordance with the repayment terms provided to them by their financial institution. For questions regarding repayment, loan balance, and forgiveness, please contact your financial institution.

I can’t repay the loan by the deadline. What will happen?

If you met CEBA eligibility criteria and are in good standing, but do not repay your loan by December 31, 2023, then you will not receive a forgivable portion. The loan will convert to a two-year term loan at 5% interest.

If you are not in good standing, you will be considered as having defaulted on your loan. If you do not repay your loan by the deadline provided to you by your financial institution, they will contact you regarding next steps.

Can I apply to change my repayment terms?

No. The CEBA program is no longer reviewing a borrower’s eligibility or their repayment terms. Applications will not be reconsidered by the CEBA program.

Where can I find more information on CEBA?

More information is available on the Government of Canada CEBA website.