COVID-19 Business Resources

Canada Emergency Business Account (CEBA)

The CEBA Application Period Deadline has passed

The Government of Canada has stopped accepting new and upsize applications for the CEBA program as of June 30. KSCU is continuing to work with any member’s that have an outstanding application, received prior to June 30, and is encountering approval issues.

Questions?  Check out our FAQs below or call the government CEBA Call Centre at 1.888.324.4201, Monday to Friday from 5AM to 6PM PST.

For program updates and more information visit ceba-cuec.ca.



FAQs

Who is EDC? Expand/Collapse

Export Development Canada is a Crown Corporation that is facilitating the CEBA program development and implementation between the Government of Canada and financial institutions all across the country.

What can I use the funds for? Expand/Collapse

Funds must be used to fund working capital needs and may not be held in a savings account or term deposit.

The loan is to be used to fund non-deferrable expenses.  A separate FAQ below lists all Eligible Non-Deferrable Expenses.

What are the payment terms? Expand/Collapse

INITIAL TERM
There is no prescribed minimum payment amount (principal or interest) or payment schedule from the Date of Loan Advance to December 31, 2022 (the “Initial Term”).   

If you repay a specified Principal Amount on or prior to the end of the Initial Term, a forgiveness amount will be applied to your loan (see FAQ regarding loan forgiveness below). The earliest date that you can being repaying principal at KSCU is November 1, 2022.

EXTENSION PERIOD
If you do not repay the specified Principal Amount on or before December 31, 2022, your loan will be extended and you will be obligated to repay your full balance by December 31, 2025. During this time you are obligated to make monthly minimum interest payments, on the outstanding Principal Amount, at the Extension Fixed Rate of 5%.  Your first minimum interest payment is due January 31, 2023.  Your payment frequency is monthly. There is no prescribed minimum Principal Amount payment during the Extension Period.  You may make Principal Amount payments at the time of your discretion.  You must fully repay the Loan Amount plus any accrued interest on or before the Balance Due Date.

What are the rules around loan forgiveness? Expand/Collapse

Repaying the outstanding balance of the loan (other than the amount available to be forgiven) between November 1, 2022 and December 31, 2022 will result in loan forgiveness up to $20,000. The loan forgiveness amount is dependent on how much you borrowed in total.

Please note: If you received both an original loan and an expansion loan, the terms of forgiveness have changed.

The forgiveness calculation is now applied to the total loan amount. If at least 75% is repaid on the first $40,000 AND at least 50% is repaid on the next $20,000, a portion of the loan will be forgiven as follows:

  • 25% on the first $40,000; plus:
  • 50% on the next $20,000.
For clarity please see the following examples:

Example 1:
       
Initial Amount Borrowed: $40,000 + $20,000 expansion = $60,000.
Required Repayment by December 31, 2022 (in order to qualify for forgiveness: $40,000.
Forgiveness Calculation: = ($40,000 x 25%) + ($20,000 x 50%)
                                    =$20,000

Example 2:       
Initial Amount Borrowed: $35,000 + $20,000 expansion = $55,000
Required Repayment by December 31, 2022 (in order to qualify for forgiveness): $37,500.
Forgiveness Calculation: =($40,000 x 25% + ($15,000 x 50%)
                                    =$17,500

Example 3:       
Initial Amount Borrowed: $30,000 + $20,000 = $50,000
Required Repayment by December 31, 2022 (in order to qualify for forgiveness): $35,000.
Forgiveness Calcuation: =($40,000 x 25%) + ($10,000 x  50%)
                                   =$15,000

Example 4:       
Initial Amount Borrowed: $20,000 + $20,000 expansion = $40,000
Required Repayment by December 31, 2022 (in order to qualify for forgiveness: $30,000.
Forgiveness Calculation: =($40,000 x 25%)
                                    =$10,000

Example 5
Initial Amount Borrowed: $15,000 + $20,000 expansion = $35,000
Required Repayment by December 31, 2000 (in order to qualify for forgiveness): $26,250.
Forgiveness Calculation: =($35,000 x 25%)
                                    =$8750

Example 6
Amount borrowed: $60,000
Required Repayment by December 31, 2022 (in order to qualify for forgiveness): $40,000
Forgiveness Calculation: =($40,000 x 25%) + ($20,000 x 50%)
                                    =$20,000

Example 7
Amount borrowed: $60,000
Required Repayment by December 31, 2022 (in order to qualify for forgiveness): $26,250
Forgiveness Calculation: =($35,000 x 25%)
                                    = $8750

Can I make payments on the loan or pay it off earlier than required? Expand/Collapse

Payments to the loan (in whole or in part) cannot be made until November 1, 2022.

The 0.00% interest period on loans under the CEBA program lasts until December 31, 2022 and there are no costs to the member in order to hold the funds until that date.

I would like to close out my Kootenay Savings account and pay out my CEBA Loan. Expand/Collapse

Unfortunately we cannot pay out a CEBA loan until November 1, 2022. We must leave your share account, chequing account and CEBA loan active until that time.

What are the pre-funding validations and post-funding validations? Expand/Collapse

In the effort to get CEBA funds out to small businesses as quickly as possible the first set of checks, called pre-funding validations, were completed by the Government and CRA. After loans were funded, further checks were completed, and are called post-funding validations. Any post-funding validation issues will be addressed in 2021.

What happens if my original loan received a post funding validation causing my expansion loan to be declined? Expand/Collapse

There are only a small number of loans with post-funding validation anomalies. EDC is currently delivering a remediation and reclassification process that will help address many of these issues. If you received a decline on your expansion loan, we will get in touch with you when the Government notifies us to do so.

Will my loan be audited? Expand/Collapse

CEBA applicants agree that the government may conduct audits to confirm the nature of the expenses applicants use to establish their eligibility for CEBA, and acknowledge that inaccuracies may lead to legal consequences.

Other Support Programs

In addition to the Government’s Canada Emergency Business Account program there are many other relief programs available to support businesses impacted by COVID-19. 

To view available resources and up-to-date information, please click the links below:

  • COVID-19 Supports for Businesses – BC Government site - for resources and an extensive list of available support programs
  • Support for Business - Government of Canada site - to learn more about available Government support programs and apply (if applicable)