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Working capital and growth financing for Canadian businesses
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View optionBusiness Loans in Canada
A business loan provides capital for a Canadian business — for equipment, inventory, expansion or cash flow. In Canada, options range from bank term loans to online lenders and revenue-based financing.
What business loans are
Business lending is underwritten on the strength of the business, not just the owner's personal credit. Lenders review revenue, time in business, cash flow and sometimes personal guarantees. Secured loans against equipment or receivables often carry lower rates than unsecured working capital.
Eligibility
- The business is registered and operating in Canada
- You can show revenue and cash flow, often 6 to 24 months of history
- You provide business and personal financial statements or bank records
- A personal guarantee may be required, especially for younger businesses
How it works
- Define the purpose and repayment source for the capital
- Prepare financial statements, tax filings and bank records
- Compare term loans, lines of credit and revenue-based options
- Review covenants, security and personal guarantee requirements
- Model the repayment against realistic cash flow before committing
What to watch for
- Business loan interest is generally deductible as a business expense; confirm with an accountant
- A personal guarantee puts your personal assets at risk if the business defaults
- Revenue-based financing is faster but usually more expensive than a bank term loan
- Compare the total cost of credit, including fees, over the full term
Frequently asked questions
How much can a small business borrow in Canada?
Amounts depend on revenue, time in business, security and the lender's criteria. Many Canadian lenders offer working capital from a few thousand dollars up to larger term loans for established businesses.
Do I need a personal guarantee for a business loan?
Often yes, especially for incorporated small businesses or newer companies. A personal guarantee means your personal assets can be pursued if the business defaults.
Is business loan interest tax deductible in Canada?
Interest on money borrowed for the purpose of earning business income is generally deductible. Confirm your specific situation with a qualified accountant.
What documents do lenders ask for?
Typically business registration, financial statements or tax returns, bank statements, and personal financial information for the owners.
Related tools and guides
Find business loans by province
Important legal information
Promissory.ca is not a lender, bank, mortgage broker or credit counsellor. We do not make lending decisions and we do not charge you a fee to use this service.
Submitting an application does not guarantee approval. All applications, rates and terms are set and approved solely by the individual lender or licensed professional.
Rates, fees and loan amounts vary by lender, province, loan type and your credit profile. Advertised rates are the lender's lowest offered rate and may not be available to you.
Lenders may perform a credit check with one or more credit bureaus, including Equifax and TransUnion. A hard credit inquiry may affect your credit score.
There is no obligation to accept any offer presented to you. Review every agreement carefully before signing.
Borrow only what you can reasonably afford to repay. Late or missed payments may result in additional fees, collection activity and negative credit reporting.
We handle personal information in accordance with the Personal Information Protection and Electronic Documents Act (PIPEDA). See our Privacy Policy for how we collect, use and protect your information.
If you are struggling with debt, consider contacting a non-profit credit counselling service or a Licensed Insolvency Trustee before borrowing more.
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Options from our Canadian lending partners. Promissory.ca is not a lender and does not make lending decisions.
Affiliate disclosure: Promissory.ca is a free comparison and referral service. We may receive compensation from lending partners when you click a partner link or submit an application. This compensation does not affect the information or comparisons we publish.
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Compare loan optionsAffiliate disclosure: Promissory.ca is a free comparison and referral service. We may receive compensation from lending partners when you click a partner link or submit an application. This compensation does not affect the information or comparisons we publish.