Government-backed loans
Canada Small Business Financing Program (CSBFP) requirements
The CSBFP is a federal program that makes banks and credit unions more willing to lend to small businesses and start-ups by sharing the risk. Here is how it works in plain language, and what the lender still needs to see from you.
- Who can apply
- Most start-ups and small businesses in Canada with gross revenue of $10 million or less
- Maximum total
- $1.15 million per borrower
- Term loans
- Up to $1 million
- Lines of credit
- Up to $150,000
- Registration fee
- 2% of the loan, which can be financed
- Who decides
- Your bank or credit union, not the government
Summarized from the official CSBFP questions page (Innovation, Science and Economic Development Canada, updated July 2026). Program rules can change, so confirm details with your lender.
What the program can finance
Term loans under the program can pay for:
- Buying or improving commercial real property
- Buying or improving new or used equipment
- New or existing leasehold improvements (renovations to space you rent)
- Intangible assets
- Working capital costs
- The registration fee itself
What it can't finance
Share purchases and assets bought by a holding company are not eligible. Farming businesses use a separate federal program, the Canadian Agricultural Loans Act program. If you're buying an existing business, the program can finance eligible assets of that business, up to the lesser of the purchase cost and their appraised value.
Interest rates and costs
- Variable-rate term loans: at most the lender's prime rate plus 3%
- Fixed-rate term loans: at most the lender's residential mortgage rate plus 3%
- Lines of credit: at most prime plus 5%
- A 2% registration fee, which can be added to the loan
- The lender's usual set-up and renewal fees, which can't be financed under the program
The program doesn't approve you. The lender does
You apply directly to a bank or credit union of your choice. The government doesn't take applications or make decisions. Lenders must apply the same care to a CSBFP loan as to any other loan of similar size, so they still look at your cash flow, credit, equity, experience and net worth.
In other words, the program can make a lender more comfortable, but it won’t rescue a file with weak fundamentals. That is exactly what a readiness check is for. See the 5 Cs of credit.
If you're declined
Lenders have different criteria, so another bank or credit union may see your file differently. Before you try again, find out what held you back and fix it first.
Common questions
Can a start-up get a CSBFP loan?
Yes. Most start-ups in Canada are eligible to apply. The lender will still look closely at your equity, credit, experience and projected cash flow.
What is the maximum CSBFP loan?
$1.15 million per borrower in total, made up of up to $1 million in term loans and up to $150,000 in lines of credit.
Do I apply to the government for a CSBFP loan?
No. You apply to a participating bank, credit union or other financial institution. The lender decides whether to approve the loan and the money comes from the lender.
Can I use the CSBFP to buy a business?
It can finance eligible assets of an existing business, but not a share purchase. Speak with your lender before paying for an appraisal.
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