The federal government has made a $350 million capital investment in the Business Development Bank of Canada (BDC), which will provide at least $1.5 billion in additional financing for small and medium-sized businesses in Canada.
Between 3,000 and 4,000 businesses ranging from manufacturers in Quebec and Ontario to tourism operators in B.C. and Atlantic Canada could gain access to the financing in the midst of the current financial crisis.
The BDC provides financing, venture capital and consulting services to small and medium-sized businesses in Canada, offering loans and investments that supplement or complete services already available from commercial institutions.
The federal government will make an immediate $250 million investment aimed at increasing the bank's term lending. It will invest a further $100 million once the BDC has developed a working capital guarantee program to top up lines of credit from financial institutions for businesses.
Since the financial crisis began in August 2007, the BDC has increased its financing activity, extended repayment terms on new loans and offered capital repayment postponement that has been accepted by 2,200 clients.