Stakeholders want CEBA loan repayment deadline extended

It’s almost time for small businesses that received relief loans during the pandemic to pay back the Feds. Danina Falkenberg learns this has small business advocates fighting for an extension to the payment deadline.

By Danina Falkenberg

The deadline to pay back COVID-19 business loans from the feds is coming up in a couple weeks.

The Canada Emergency Business Account, or CEBA, started in 2020 by the federal government, and it was financial relief offered to businesses negatively affected by the pandemic.

Years later, some businesses are still struggling to get back on track, and stakeholders want an extension to the loan repayment.

“It’s all compounding issues for different parts across the country; so out in B.C. forest fires, or perhaps Ontario maybe inflation is a little higher in Ontario. We’re dealing with compounding issues across the country, and every single area is dealing with their own challenges,” explained small business advocate and professor Michael Wood.

According to the federal government, 125,000 businesses in Alberta were approved for CEBA loans up to $60,000.

If small businesses that received the loans pay it back by the Jan. 18 deadline, they can be forgiven for up to $20,000 of what they borrowed.

“So, somebody has paid back $30,000 and they need that extra $10,000 to pay off CEBA, so their friends don’t have it based on inflation, the economy, all these different reasons, their family doesn’t have it — same thing. And they can’t find a bank or a lender so they’ve paid back — as of today — 75 per cent of the loan, that $20,000 penalty for lack of a better description, is going to really hit a lot of people hard,” Wood said.

The Alberta Hospitality Association says if an extension is not given, one in five restaurant operators say they will need to close some, if not all, of their locations.

“It’s been tough, it’s been very hard,” Ernie Tsu with the association said. “Again, the spike in inflation on food costs have really, really hurt a lot of restaurants. They can’t just keep raising prices in a market right now where gursts are struggling on their own.”

Wood says two weeks before the CEBA payment deadline, stories are going to have to continue being shared about why the businesses are continuing to struggle.

Tsu says they’ve been hearing from Alberta Hospitality Association members and businesses that they would really like an extension if at all possible.

“Death by a thousand cuts — you’ve got the inflation on food costs, you have supply chain management cost going up, labour costs have gone up — it’s just a tough time for this to be coming down the pipe,” he added.

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