Eligible businesses can now start applying to the Highly Affected Sectors Credit Availability Program (HASCAP).
Announced Jan. 26, the program provides financial support to businesses across the country, in all sectors, that have been hardest hit by the pandemic. This includes restaurants, businesses in the tourism and hospitality sectors, and those that rely on in-person service.
Through HASCAP, the Business Development Bank of Canada will work with participating Canadian financial institutions to offer government guaranteed, low interest loans of up to $1 million. Hard-hit businesses, like a chain of hotels or restaurants with multiple locations under one related entity, could be eligible for up to $6.25 million.
HASCAP will help businesses with their day-to-day operating costs during the COVID-19 crisis and enable them to invest in their longer-term prosperity.
The program offers up to a 10-year repayment term with a four per cent fixed interest rate, as well as a postponement of principal repayments of up to 12 months at the start of the loan.
To be eligible, businesses must show a year-over-year revenue decline of at least 50 per cent in three months, within the eight months prior to their application. They must also be able to illustrate to their financial institutions that they have previously applied for either the Canada Emergency Wage Subsidy or the Canada Emergency Rent Subsidy.
HASCAP applications opened Feb. 1 at major financial institutions. It will open more widely by Feb. 15.
The program was first outlined in the federal government’s fall 2020 economic statement.