Deployment of the HASCAP reduced rate loan in progress

Financial institutions have started rolling out low-interest loans promised to commercial operators facing financial strains from the pandemic. As announced in the federal government economic declaration Last fall, loans of $ 25,000 to $ 1 million will be available under the Highly Affected Sectors Credit Availability Program (HASCAP), fully guaranteed by the Business Development Bank of Canada (BDC).

HASCAP is aimed at previously financially stable small and medium-sized businesses in Canada that have experienced a 50% or more drop in revenue due to COVID-19-related reasons. Loans are intended to support the continuation or resumption of business activities and cannot be used to repay or refinance existing debt. Businesses with more than one location, such as hotels, restaurants, or retail outlets, may be eligible for multiple loans up to a maximum of $ 6.25 million.

“We know that the second wave of this virus continues to weigh on many workers and businesses. HASCAP is providing new support to people in the sectors most affected – such as tourism, hospitality, the arts and culture – so that they can weather this storm and be ready for a strong recovery, ”said Minister of Foreign Affairs. Finances Chrystia Freeland.

Major financial institutions are expected to start administering HASCAP on February 1, and more lenders are expected to join us by mid-month. The loans will have a term of 10 years at an interest rate of 4%, and approved borrowers will be able to defer principal payments for up to 12 months from initial receipt.

To be eligible, businesses can show proof that they have been eligible for the Canada Emergency Wage Subsidy (CUS) and / or the Canada Emergency Rent Grant (CERS) at least three of the eight months preceding their application. Alternatively, some businesses that were not eligible for the ESRB or SSUC may be accepted if they can provide financial statements showing three months where year-over-year revenue has declined by at least 50 percent over the course of the year. of the previous eight months.

While potential borrowers are required to apply through their primary financial institution, they will also need to complete an online form providing “high level information” for BDC. “This information will help the Government of Canada understand which companies are seeking assistance under this program, the accompanying information states.

“We know that even the most resilient businesses continue to face incredible challenges,” notes Mary Ng, Minister of Small Business, Export Promotion and International Trade.

HASCAP will be open for applications until June 30, 2021.

About Leslie Schwartz

Check Also

SBI Adani I case French Amundi threatens to sell SBI bonds on proposed loan for Adani coal mine of 5,000 cr

French Amundi threatens to sell SBI bonds on proposed loan for Adani coal mine of …

Leave a Reply

Your email address will not be published.