Startup Business Loans

If you are looking to start up your business, one of the most important things that you will need is capital. After you must have drafted out your business plan and requirements, the next step is to find a means of financing your business in such a way that it will kick off with a healthy start.

One of the major reasons small businesses crash even before they fully start is because they are usually undercapitalized. Small business loans can be the answer to your startup business’s financial problems.


Startup business loans are a category of loans given to entrepreneurs starting a business or small businesses that are just kicking off.  Startup loans are usually term loans; the startup is allocated the required sum which will be repaid fully and with interest once the selected loan term is over. In Canada, small business loans can be used to refer to the Canada Small Business Financing Program which is powered by the government. This program makes it easy for startups to get loans from traditional financial institutions by sharing the loan risks with lenders. In the last decade, small businesses in Canada have gotten over 56,000 loans approved which sums up to an approximate total of $10 billion.

Startup business loans do not only provide small businesses with the capital needed, they can also be used for different aspects of your business including business expansion.

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Written by: Big Piggyy



Loan Term

14 days -60 months

Est. APR

% 390 - 445

Loan Amount

$100 - 15,000



Loan Term

14 days - 60 months

Est. APR

% 173.81 - 495.36

Loan Amount

$50 - $10,000



Loan Term

12 - 60 months

Est. APR

% 46.93

Loan Amount

$100 - $15,000



Loan Term

90 -150 days

Est. APR

% 26

Loan Amount

$500 - $850



Loan Term

6 - 60 months

Est. APR

% 19.99 - 36.99

Loan Amount

$500 - $15,000

Startup Business Loans Available in Canada

Many loans are available to startups in Canada. The most popular ones are:


Canada Small Business Financing Program

This is a kind of loan where the money given is to be paid over a specified period and with interest. This loan is a combination of a government support program and small business loans.


Bank Business Loans

These are regular loans that you can get from traditional financial institutions like banks. Bank business loans usually make use of collateral. The thing to know about bank loans is that although good, they might not be the best choice for small businesses. This is because banks lending little amounts of money with low-interest rates do not yield enough profit for banks. In order for a bank to generate sizable profit from a loan, the loan has to be for a large amount at a high-interest rate. 


Online Business Loans

Online business loans are very similar to bank business loans, the major difference is that the lenders of the former are purely online. Online business loans are lower-cost, and they are a good choice for startups because the lenders can offer loans for small amounts. Amounts that could be seen as unprofitable to regular banks.


Private Business Loans

A private business loan is not specific to one organization hence, it can come in any form. Private business loans could be gotten directly from venture capitalists, an investor looking to support your small business, or perhaps a family member could decide to loan you part of your capital.

Private business loans could also be gotten from crowdfunding platforms. 


Credit Union Business Loans

Credit unions work as nonprofit and their rate of interest is usually lower than that of banks. Credit unions can offer flexible amounts in loans; they can not offer low amounts that regular banks will find unprofitable. As a startup with no credit history, you would have to provide collateral when vying for a loan.


How to Apply for a Startup Business Loan

Oftentimes, financial institutions are in charge of approving loans and providing the program.

Before you start filling out loan applications, discuss your business and business needs with a professional credit union or financial officer in Canada. The professional assesses and reviews your business plan and proposal to help you make a good decision based on your loan application. Once you have been approved to be financed under the program, the chosen financial institution will pay the funds and register the loan. It is important to find a lender that is close by and easily accessible so that the process will go faster.


What Can Startup Business Loans be Used for?

Start up business loans are not only used to kickstart your business, they can be used for several other things like:


  • Purchasing or improving land used for commercial purposes.
  • Financing restaurant equipment.
  • purchasing or improving a building or space used for commercial purposes.
  • Buying or improving equipment for the business.
  • Financing commercial vehicles.
  • Financing computers, software, and electronic equipment.
  • Making necessary changes in business space.


What is the Loan Period for a  Startup Business Loan?

There is no fixed loan period for a startup business loan. Usually, some loans are available for a short period; 3 months to 18 months. And there are really long-term loans that can go up to 10 years. As a startup, you should know that short-term loans are more readily approved than long-term. This setting is usually better for lenses because it prevents terrible future unforeseen circumstances.


What are the Requirements for Startup Business Loans?

The truth is that different lenders in Canada have specific requirements. But, to be eligible for a loan anywhere, you must have some basic requirements:

  • Your business must be based in Canada.
  • You must be a permanent resident in Canada or a Canadian citizen.
  • Your financial documents should be up to date.
  • Your business status should be legal.
  • You should have a good credit score.
  • You should have a detailed business plan describing how you intend to use the loan.

You can’t know exactly what you need to apply for a business loan because requirements vary from lender to lender. The best thing to do is to do a thorough research of all business loan products before you decide whether to apply or not.



There are different ways to go about getting funds for your small business, but it is advisable to get your money from the best lender you can find. Before applying for a loan, carry out thorough research on the lender you would like to use, the lender’s requirement, and the company. Also, take loans that you can pay off at the designated time.

Big Piggyy

"Show me the MONEY!!!" – Jerry Maguire

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