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Calls are growing louder for the federal government to extend the loan repayment deadline for small businesses that took out federal loans during the pandemic to tide them over.
The Canada Emergency Business Account (CEBA) loan offered federally backed interest free loans up to $60,000. Payment is due Jan. 18.
Among the London businesses that took advantage of the program was Hyland Cinema on Wharncliffe Road.
Owner Moira Adler said ticket sales have bounced back, and membership has increased since CTV aired this story last fall.
However, having to repay the CEBA loan in full at this time will be a challenge, as the business has just begun its recovery.
“That helped us to get back into operation, hire staff again, be able to pay for the cost of the building, and just get running again,” said Adler of the CEBA program.
Restaurants Canada is the latest organization to call for an extension of the loan.
President and CEO Kelly Higginson said they need one more year to get closer to pre-pandemic business levels.
“It’s definitely taken longer for this industry to start to recover. We were disproportionately impacted dramatically during the pandemic and coming out of the pandemic. Coming out of the pandemic we were continually hit with headwinds, significant inflationary pressures, constant volatility, and uncertainty,” said Higginson.
Restaurants Canada said a survey it commissioned showed that one if five restaurants is on the brink of closing one or more of its locations.
London North Centre MP Peter Fragiskatos (Liberal) said he’s sympathetic to local businesses still trying to make it in a post-pandemic business landscape.
“Although it makes it difficult when the government has already extended the program by a year,” said Fragiskatos. “But this does not mean that my door is closed, quite the contrary. One of the reasons that we have CEBA in the first place is because MPs listened to small business owners and their community and advocated accordingly.”
Businesses that do pay back the loan by Jan. 18 can avoid a 5 per cent interest rate that kicks in at that time.
Businesses that pay back the bulk of their loan can see up to $20,000 forgiven.
As for Moira Adler, she said she plans to pay back the loan- there just won’t be anything left to run the business once she parts with that cash.
“We’re right on the line, so if you’re taking any kind of buffer you have for your operating budget, and take that away, then you’re always like right on the line of whether you’re going to make your next payroll or not,” said Adler.
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