In 2024, Canadian small businesses establishments (1-99 employees) constituted 98% of all businesses. Small businesses employed 5.8 million individuals at the enterprise level, or 46.6% of the private sector labour force.
Supply-side survey data show that outstanding debt held by all businesses increased in 2024 to CAD 1 363 billion. Lending to small businesses increased to CAD 160.1 billion (from CAD 134.8 billion in 2023). As a result, small businesses’ share of total outstanding business loans in 2024 was 11.7%.
Small business credit conditions eased by the end of 2024. The average interest rate charged to small businesses decreased from 9.0% in 2023 to 7.3% in 2024, with an average prime rate (the rate charged to the most creditworthy borrowers) of 6.8% (from 6.9% in 2023). The business risk premium (measured as the difference between the average small business interest rate and the business prime rate) declined to 0.5%, reflecting an easing in access to financing for small businesses and large businesses in Canada. Bank of Canada survey results indicate that lenders reported that overall business lending conditions eased towards the end of the second half of 2024. Borrowers also reported easing of credit conditions during the same period.
In 2024, the small business 90-day delinquency rate rose to 0.86% after reaching 0.25% in 2023 and 0.26% in 2022.
Total venture capital (VC) investment levels in Canada were CAD 7.9 billion in 2024, up from CAD 7.1 billion in 2023.
The Business Development Bank of Canada (BDC), a crown corporation with the mandate to support Canadian entrepreneurship, had CAD 48.1 billion in financing and investments, as of 31 December 2024, committed to 109 000 clients operating across Canada. As the most active VC investor in Canada, the BDC invests both directly into firms and indirectly through external VC funds, with the objective of making Canadian VC a financially viable and attractive asset class for private sector investors and institutional investors.
The Government of Canada has further supported the development Canada’s VC ecosystem by convening public, private, and institutional sources of financing through its Venture Capital Action Plan (VCAP) and Venture Capital Catalyst Initiative (VCCI). Taken together, the Government of Canada has invested CAD 1.2 billion, resulting in a combined total of over CAD 3 billion in capital raised from public and private sources to help Canadian companies start up and grow.
The Government of Canada has established a number of programmes to provide support targeted to entrepreneurs from underrepresented groups. The Government has made total investments of nearly CAD 7 billion in the Women Entrepreneurship Strategy (WES); of CAD 189 million in the Black Entrepreneurship Program (BEP); of CAD 60 million for Futurpreneur, a programme to support youth entrepreneurs; and of CAD 25 million to Canada’s 2SLGBTQl+ Chamber of Commerce to deliver a program aims to address the unique challenges faced by 2SLGBTQl+ entrepreneurs to help start and grow businesses. The Aboriginal Entrepreneurship Programme also provides access to capital and business opportunities to First Nations, Inuit and Métis Nation entrepreneurs.
The Government of Canada offers a wide range of initiatives and programs to help businesses capitalize on opportunities, diversify markets, and grow globally. Global Affairs Canada’s (GAC) Trade Commissioner Service (TCS) helps Canadian businesses grow by connecting them with government funding and support programs, international opportunities, and a network of employees in nearly 150 international locations. The TCS offers the CanExport Program, which consists of four sub-programs: CanExport SMEs, CanExport Innovation, CanExport Associations and CanExport Community.
Export Development Canada (EDC) is Canada’s official export credit agency, with a mandate to support and develop Canada’s export trade and Canadian capacity to engage in that trade and respond to international business opportunities. To fulfill its mandate, EDC offers a range of services including insurance, financing, bonding, and equity investments as well as trade knowledge. In 2024, EDC facilitated over CAD 46 billion for SMEs.
Canada’s seven regional development agencies (RDAs) are the federal government’s front line for regional economic development with points of service in communities of all sizes and are often called upon to deliver targeted programs tailored to the respective region. They play a critical role in supporting regional innovation ecosystems and helping businesses grow. While nationally co-ordinated, their programs are tailored to reflect the unique needs and opportunities of each region. RDAs deliver two nationally standardized programs; first the Regional Economic Growth through Innovation (REGI) supports small and medium-sized enterprises (SMEs) and strengthens regional innovation ecosystems and second, the Community Futures Program (CFP) fosters economic development, primarily in rural communities, though a network of Community Futures Organizations (CFOs) that offer business support and improved access to capital. Together, these programs help build strong, resilient regional economies.