Best Microloans in Canada 2024
What You Should Know
- Microloans or microfinance refer to loans of a small amount, generally up to $50,000.
- Microloans are often meant for specific individuals and purposes, such as loans for women entrepreneurs.
- Microloans are often available for individuals and businesses of a specific region.
What is a Microloan?
Microloans are loans of a small amount, generally a few hundred or a few thousand dollars, meant for individuals and small businesses with limited access to traditional bank loans. They are often meant to support entrepreneurship and upskilling and can be a suitable option for new immigrants, refugees, low-income earners, women-led businesses, small businesses, and startups.
Who Can Get a Microloans?
Several microfinance programs are limited to a certain section of the population. For example, the WEOC National Loan Program is meant only for women entrepreneurs, and the Windmill Microlending Program is for new immigrants and refugees. There might also be a limitation to how the loan can be used, such as for business or professional training or upskilling. Microloan or microfinance programs are often location-specific, which means they are available only to the residents of a particular region.
In general, microloan programs could be a good loan option for individuals with no or low credit scores, such as new immigrants, and for small businesses that require only a small capital to get started.
How Do Microloans Work?
Microloans work similarly to traditional loans. The borrower must apply for the loan with the microfinancing institution, and the loan amount is disbursed upon approval. The borrower must then repay the loan back to the microloan lender in regular payments over a period of time. Micro loans often have shorter repayment terms than traditional loans and might also have a lower interest rate. The maximum loan amount available through microloan programs generally doesn’t exceed $50,000.
Microloan Programs in Canada
Loan Amount - Up to $15,000
Interest Rate - 6.7% (as of June 2024)
Description - Windmill Microlending provides loans to skilled immigrants for upskilling, education, accreditation and other purposes that will help them integrate into the Canadian workforce. This program is specially designed for immigrants and refugees who are educated and experienced, yet their credentials are not recognized by Canadian employers. The loan interest rate is 6.7% (as of June 2024). Apart from financing, the program also includes career coaching and mentorship.
Loan Amount - Up to $50,000
Interest Rate - Max. NaN%
Description - Women entrepreneurs can get a microloan through the Women’s Enterprise Organizations of Canada’s WEOC National Loan Program to start, scale or grow their businesses. The term lengths are up to five years, and the maximum interest rate is Prime Rate + 4%. Interested individuals can apply through the provincial loan fund partners, which are as follows:
- Alberta - Alberta Women Entrepreneurs (AWE)
- British Columbia - WeBC
- Manitoba - Manitoba Women’s Enterprise Centre
- Newfoundland and Labrador - Newfoundland & Labrador Organization of Women Entrepreneurs (NLOWE)
- Nova Scotia - Centre for Women in Business
- Ontario - PARO Centre for Women’s Enterprise
- Saskatchewan - Women Entrepreneurs of Saskatchewan (WESK)
All other provinces' residents can apply for similar loan programs, such as DELIA – NCFDC and NACCA.
Loan Amount - Up to $60,000 (Including $40,000 from BDC)
Interest Rate - The interest rate for the $20,000 Futurepreneur portion of the loan is CIBC Prime + 3%, up to a maximum of 9%. The interest rate for the rest $40,000 BDC portion of the loans is BDC’s current floating base rate + 1.65%.
Description - Futurepreneur is a loan program that provides loans and mentorship to young entrepreneurs. To be eligible, the applicant must be a Canadian citizen or permanent resident and between 18 and 39 years of age. Futurepreneur also offers programs specifically for black entrepreneurs and Indigenous entrepreneurs. Their side hustle entrepreneur loan program offers loans of up to $15,000.
Community Futures Network Of Canada
Description - CNFC operates a network of 267 non-profit offices across Canada, providing services such as loans, tools and training for small businesses to those living in rural and remote areas. Those looking to get a loan for their small business can locate a community futures office near them and contact them.
Microloan Programs in Ontario
Alterna Savings Microfinance Program
Loan Amount - Up to $25,000
Interest Rate - NaN%
Description - The fund provides loans to entrepreneurs under six different focus segments that include low-income earners, professional development, skilled professionals & trades, social entrepreneurs & enterprises, women entrepreneurs, and black entrepreneurs. The maximum loan amounts vary based on the focus segment.
Energize Microloan Fund for the Arts
Loan Amount - $2,500 to $5,000
Interest Rate - 3.5% (as of June 2024)
Description - ArtsBuild Ontario and Community Forward Foundation provide this loan to Ontario’s non-profit arts organizations to make their spaces more energy efficient. The loan can be used for projects to reduce energy consumption or for plans and reports needed for energy efficiency evaluation. The interest rate for the loan is 3.5%.
Ottawa Community Loan Fund (OCLF)
Loan Amount - Up to $15,000
Interest Rate - NaN% to NaN%
Description - The OCLF fund provides microfinancing for starting or expanding small businesses and professional development loans. The maximum loan amount for professional development loans is $5,000. The interest rates are Prime + 2% to 6%. Meanwhile, the repayment terms for small business loans range up to 60 months and for professional development loans range up to 36 months.
Thunder Bay Ventures Microloan Program
Loan Amount - Up to $25,000
Description - Thunder Bay Ventures provides this loan as a quicker way to get a small investment for local businesses.
Microloan Programs in Quebec
Loan Amount - Up to $20,000
Interest Rate - Up to 9%
Description - Formerly known as the Montreal Community Loan Association or ACEM, Microcredit Montreal provides loans to entrepreneurs who cannot secure a loan through conventional channels. The interest rate for the loan is variable up to 9% and must be repaid over a maximum time period of three years. Microcredit Montreal also provides bridge loans of up to $50,000 to businesses and loans of up to $15,000 to internationally trained professionals.
Loan Amount - Up to $20,000
Interest Rate - 10% (as of June 2024)
Description - Fonds d’Emprunt Montérégie provides micro-loans to companies with viable and socially responsible business projects who have been denied a loan by traditional institutions. The loan must be repaid over a term of 12 to 36 months and has an interest rate of 10%. To be eligible, the company must be located in Montérégie’s territory and must have a business plan along with a two-year forecast.
Microloan Programs in British Columbia
Loan Amount - Up to $75,000
Interest Rate - NaN%
Description - Vancity Credit Union offers several loan programs for different types of borrowers, such as loans for startups and growing businesses, loans for black entrepreneurs, loans for women entrepreneurs, loans for indigenous entrepreneurs and loans for small growers and farmers. The maximum loan amount varies based on the loan program, while the interest rate for most microloans is Prime + 3%.
Microloan Programs in the Prairies
Business Revitalization Micro Loan Program
Loan Amount - Up to $10,000
Interest Rate - NaN%
Description - The loan program provides financing to store-front businesses in East Parkland, Alberta to upgrade or improve the cosmetic appearance of their business. The interest rate is ATB Prime + 2%, and the maximum loan term is 5 years.
CCDF - Women’s Micro Loan and Grant Program
Description - The Clarence Campeau Development Fund (CCDF) operates this combined loan and grant program for Saskatchewan Métis Women who want to become entrepreneurs.
Indigenous Women Entrepreneur (IWE) Program
Loan Amount - Up to $20,000
Description - The loan program by the Saskatchewan Indigenous Enterprise Foundation provides loans to First Nation Women entrepreneurs in Saskatchewan for starting or expanding a small business.
Loan Amount - Up to $30,000
Description - The program provides loans to skilled immigrants in Manitoba, who want to get their qualifications recognized in Manitoba and gain employment in the field of their expertise or seek an alternative career. The loan is provided through the Assiniboine Credit Union.
Microloan Programs in Atlantic Canada
Atlantic Immigrant Career Loan Fund (AICLF)
Loan Amount - Average loan of $15,000, but larger loans are available
Interest Rate - NaN%
Description - The AICLF assists internationally trained immigrants residing in Atlantic Canadian Provinces (Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland and Labrador) to get the necessary training, licensing, registration, etc., required to gain employment in Canada. The loan interest rate is RBC Prime + 1%.
Loan Amount - Up to $10,000
Description - CBDC (Community Business Development Corporation) is a not-for-profit organization that supports the creation and expansion of small businesses across Atlantic Canada. While it offers several types of loans of up to $150,000, such as the General Loan, Impact Loan Program, and Immigrant Loan Program, its Micro Loan program offers loans for eligible business activities with a base in Queens County or Lunenburg County, Nova Scotia.
Loan Amount - Up to $5,000
Description - CUA Microloan Program is available to Canadian citizens and permanent residents of mature age residing in Nova Scotia. If the loan is for business purposes, the business must be based in the Halifax region of Nova Scotia and create at least one job.
Canada Microcredit Educators Group - Foreign Credit Recognition Program
Loan Amount - Up to $15,000
Interest Rate - NaN%
Description - FCR is a program for internationally trained immigrants living in Prince Edward Island that facilitates the recognition of their international qualifications. The loans can be used to cover training costs or living costs while obtaining training or certifications required to seek employment in Canada. The rate of interest for the loan is Prime + 1%, and it must be repaid fully within two years of completing the education or training program.
Loan Amount - Up to $10,000
Description - Young entrepreneurs under the age of 35 residing in Newfoundland and Labrador can get low-interest loans for their businesses through the KICK$TART Loan Program.
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