Some Sask. businesses still struggling to repay CEBA loans

According to the federal government, a quarter of the businesses that received a Canada Emergency Business Account (CEBA) loan didn’t pay it back when the deadline hit on Jan. 18.

Businesses throughout Canada were presented with the option to apply for the loan as they dealt with restrictions and closures during the COVID-19 pandemic.

Keith Moen, executive director of the North Saskatoon Business Association, said it’s concerning news to hear.

“There’s been challenges across the board,” Moen stated during an appearance on The Evan Bray Show on Wednesday morning.

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“I can say anecdotally that there are businesses unable to get the financing in place to repay that – whether it comes from your own capital and reserves or to qualify for a loan from another lender – which is troubling because if they aren’t qualifying for loans from other lenders, then that means this CEBA account is likely going to end up in default.”

While most people think we’re free and clear of the pandemic now that things have been largely back to normal for a couple years, Moen suggested there are still many businesses out there struggling with the lingering effects of the pandemic.

“The small and medium-sized businesses, particularly those in the entertainment, hospitality and recreation-type businesses, they’ve felt it the worst. These are all businesses that prior to the pandemic were quite strong and luminous across the province, but they’re still experiencing difficulty and challenges,” he said.

“That’s a problem, because over 90 per cent of our businesses in the province are small business, and that’s the lifeblood of our economy.”

With businesses struggling to pay back the loans, Moen said it could lead to businesses being forced to default on the loans or go out of business, which means people will lose their jobs.

“It’s going to be problematic for the economy as a whole if we aren’t able to see our way through this,” he added.

Coming out of the pandemic, businesses have also had to deal with added pressures from inflation and the federal carbon tax.

Moen said Saskatchewan businesses are feeling all of those things.

“The carbon tax is not only on the energy bills, but it’s on essentially everything we’re doing. Every supplier (or) vendor interaction you have, there’s a carbon cost attached to what they’re doing (and) what they’re trying,” he said.

“The fuel costs are getting up there as well. Everywhere it’s prevalent and it’s just starting. We’re going higher, so hang onto your boots because we’re in for a rough ride.”

The full interview with Moen can be heard below.