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The federal government is extending the deadline for businesses to repay the Canada Emergency Business Account (CEBA) loan, as many regions across the country face renewed restrictions in the wake of the Omicron variant.
Prime Minister Justin Trudeau and Minister of Small Business and Economic Development Mary Ng announced at a press conference on Wednesday that the government will extend the repayment deadline for business that qualified for the CEBA program. Companies will now have until Dec. 31 of 2023 to repay the loan.
"We've heard from businesses that they're looking for this flexibility," Ng said.
"This additional year will help businesses get that flexibility and continue to work together through this pandemic to end this pandemic."
Nearly 900,000 businesses were approved for CEBA, a program that granted interest-free loans between $40,000 and $60,000. When the program was first introduced, the loan was capped at $40,000, with up to $10,000 forgivable if certain conditions are met. The government expanded the loan total to $60,000 last December, allowing another $10,000 to be forgiven if the loan is repaid by the deadline. The government approved $49.2 billion in total funds for CEBA loans and the expansion program.
The Canadian Federation of Independent Business (CFIB) had pushed the government to reopen the program for businesses as well as delay repayment requirements. CFIB president Dan Kelly said the deadline extension was "good news" for small businesses.
"CEBA has been an incredibly helpful program and used by nearly 900,000 small business owners," Kelly said in a statement posted on Twitter.
"Importantly, it's not just a $60,000 loan, as the $20,000 forgivable portion is one of the few programs that helps reduce the COVID debt small firms have taken on."
Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.