Small Business Tips

Small Business Loans and Grants for Women in Canada

Victoria Morrison

Looking to borrow or raise money to start a small business in Canada? The bank isn't your only option. In fact, there are many government and non-government programs that are in place to help entrepreneurs launch or grow a business.

Keep reading for a list of small business loans and grants that are available to women in Canada, and find out if you qualify for them.

What are the best small business loans for women?

Before we delve into the leading business loans that are available to women entrepreneurs in Canada, keep in mind that most of them emphasize location rather than demographics. Luckily, the government of Canada has created a handy tool that you can use to find the most relevant business loans for your profile.

With this in mind, some small business loans aim towards helping Canadian women start and grow their businesses. Here is a list of Canada's top small business loans for female entrepreneurs.

BDC Women in Technology Venture Fund (All of Canada)

The Business Development Bank of Canada recognizes that women are under-represented and underfunded in Canadian investment and technology companies, and it wants to change that. For this reason, the BDC has decided to invest $200M in early-stage technology companies that have women executives. You can apply on the BDC's website.

Microloans for Low-Income Women in Ontario

This program helps low-income women based in certain parts of Ontario build and grow businesses. The program trains women in low-income brackets to allow them to learn the skills needed to start and run a small business. Skills taught include financial literacy training, mentoring, and skills development. It also provides microloans for women who become business-ready as a result of these training programs.

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Femmessor Loans for Women (Quebec)

Femmessor is a Quebec organization that contributes to the development of female entrepreneurs. The organization seeks to support the creation, growth, and acquisition of viable businesses owned and led by women. It does so by providing women with the resources that are crucial for success.

Femmessor has two branches of funding for women entrepreneurs. These include conventional loans and business equity investments.

Conventional loans: Start-up program

This program grants loans of $20k to $50 to women-owned businesses. To qualify, a woman - who plays a strategic role in the company - must own a minimum of 25% of the business's shares. This loan can serve to finance tangible or intangible assets, working capital, product development, the development and commercialization of new products and services, or buying shares.

Conventional loans: Business growth, acquisitions, and transfers

The Femmessor program also grants loans of $20K to $150K to women who are looking to expand, acquire, or transfer a business to the next generation. Interest rates are based on the borrower's risk profile. The maximum amortization period is five years and loans are subject to file processing and monitoring fees.

Equity Investments

Femmessor also invests up to $250K in companies that have existed for at least three years. As with the start-up program, companies must have at least one woman in a strategic company role, and she must hold at least 25% of the company's shares. This option allows the company to hold on to a majority of its shares, with no pressure to liquidate. It can also make it easier to secure additional financing from banks and other financial partners.

You can find out more about Femmessor loans and equity investments by visiting their website (French only).

Women's Enterprise Centre (British Columbia)

This organization offers business loans of up to $150K to women based in British Columbia. Loans can be used for things like start-up costs, business acquisition expenses or the cost of expanding a business. Loans granted by the BC Women's Enterprise Centre also come with free ongoing business advice, mentoring, and business skills training.

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Alberta Women Entrepreneurs (AWE)

Alberta Women Entrepreneurs (AWE) is a non-profit organization created to help Alberta women start, enhance, and grow their businesses. It offers small business loans ranging from $30K to $150K to women-owned businesses in Alberta. Should you need more than $150K, AWE might be able to partner with other lenders in your area to make it happen.

To qualify for an AWE loan, applicants must:

  • Be applying for a loan for a business registered and located in Alberta and at least 51% woman-owned.
  • Have a minimum credit score of 650.
  • Contribute at least 30% security on the loan. Loans may also require up to 100% security depending on the size, risk, and reason for the loan.
  • Contribute at least 25% of the owner equity on the total cost of the project.

AWE differs from conventional lenders in the sense that it offers flexible repayment options with terms lasting up to five years and competitive interest rates (Prime +3%). For more information, consult the AWE website.

Women Entrepreneurs of Saskatchewan (WESK)

If you are a female business owner in Saskatchewan, you may be eligible to get a loan from Women Entrepreneurs of Saskatchewan (WESK). WESK grants loans of up to $150K to women entrepreneurs to create jobs, grow sustainable businesses and contribute to Saskatchewan's prosperity.

To qualify for a loan, borrowers must:

  • Be or become members of WESK
  • Operate or plan to operate a business that is woman-owned or mostly woman-owned (51% or more) in Saskatchewan
  • Be in a position to contribute 20% in equity towards the project
  • Meet with a WESK business advisor to review or finish the business plan
  • Fill out a loan application
  • Provide a personal financial statement
  • Pay a $500 loan application fee

Women's Enterprise Centre of Manitoba (WECM)

The Women's Enterprise Centre of Manitoba (WECM) acts as a resource for women entrepreneurs. They work with women across Manitoba to assist them with the steps necessary to help their business succeed.

WECM provides small business loans up to $150K to woman-owned businesses in Manitoba. Male-female partnerships may also apply, as long as the woman owns at least 50% of the business. She must also help manage and operate the business.

To qualify for a WECM loan, borrowers must present a comprehensive business plan. WECM offers in-person and online seminars to help with this process.

To qualify for a loan, applicants must:

  • Have a business that has been profitable for at least three years
  • Present at least one year of projected monthly cashflow and profit/loss statements
  • Provide a business case with an overview of the business, expansion details, and a viability analysis
  • Submit a loan application along with a personal statement of affairs
  • Undergo a credit check
  • Provide a detailed list of accounts payable, accounts receivable, and inventory (on a case-by-case basis)
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Community Business Development Corporation of Atlantic Canada (CBDC)

The CBDC is an association that strives to assist in the creation and expansion of small businesses in Canada. They offer financial assistance in the form of loans, loan guarantees, and equity financing. The CBDC also provides business advice, counselling and training.

For more information about resources aimed at people living in the Atlantic region of Canada, consult the Restigouche branch of the CBDC. Namely, they offer first-time entrepreneur loans, innovation loans, and resources for women in business.

What are the best small business grants for women?

A business grant differs from a business loan in the sense that grants don't require repayment. Unfortunately, in the business world, grants are much less common than loans or equity funding.

Consequently, there are a few organizations that have created grants to encourage women entrepreneurs in specific industries. Here are a few.

The Eileen-Fisher Women-Owned Business Grant

The Eileen-Fisher Women-Owned Business Grant Program launched in 2004. Each year, the program awards up to 10 grants to women-owned businesses that aim to create environmental and social change.

In 2018, the organization put the program on hold to evaluate their grant portfolio, although it plans to relaunch the program in the spring of 2019.

Pitch for the Purse

Pitch for the Purse is a program (and television show!) created by Vancouver's Forum for Women Entrepreneurs (FWE). As part of this program, participants receive pitch training and mentorship. While there can only be one winner of the annual $25,000 prize, all participants gain valuable knowledge and business contacts to help them along their entrepreneurial journey. The program is typically open for applications in the summer.

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The Amber Grant

Each year, Womensnet selects 12 women to receive a $1K business grant (one per month). At the end of the year, one of these women will receive an extra $10K. To qualify for an Amber Grant, businesses must be based in the U.S. or Canada.

The Canada Job Grant

The Canada Job Grant was put in place by the Government of Canada to help employers train new or existing employees. Although this grant is not solely aimed at women, it can still help women-owned businesses who are looking to train new employees regardless of your region or industry.

The Canada Media Fund (CMF)

Do you create media for television, films, software, video games, or mobile applications? You might be eligible to receive a grant from the Canada Media Fund. According to the organization's 2017-2018 annual report, more than 40% of key leadership roles for CMF-funded television productions were filled by women.

Qualification to receive a CMF grant requires your involvement in a for-profit venture. Development of projects must primarily originate in Canada, and you must prove that you intend to take your product to market. In 2018-2019 alone, the CMF is contributing $352M to Canada's television and digital media industry.

Futurpreneur Program for Newcomers to Canada

If you are new to Canada and are looking to start a business, you might have trouble securing a loan due to limited credit history. If this sounds like you, check out Futurpreneur's program for Canadian Newcomers.

To qualify, you must:

  • Be between the ages of 18-39
  • Have lived in Canada for less than 60 months (as of the application date)
  • Be a Canadian citizen or permanent resident of Canada
  • Have a social insurance number that does not start with a ‚Äú9‚Äù
  • Provide two character references (at least one must be from a Canadian citizen)
  • Have a limited credit history in Canada, if any

BDC New Canadian Entrepreneur Loan

The Business Development Bank of Canada also offers loans for Canadian newcomers. If you have been in Canada for less than three years, have Canadian citizenship or permanent resident status, have no established credit history and a viable business plan, you may be eligible to receive a loan of up to $50K from the BDC.