AFO · Head-to-head
The Canada Small Business Financing Program guarantees up to $1.15M of bank debt for businesses under $10M in revenue. Conventional senior debt starts at $500K and runs into the tens of millions, with stricter underwriting and no government guarantee. Where each is the right answer depends on size, financials, and how the lender's credit committee will read the package.
Side by side
The matrix below pulls directly from the catalog. Each row shows the same data point across both programs so you can spot the differences at a glance.
| Attribute | Conventional Senior Term Loan or Revolver | CSBFP — Canada Small Business Financing Program |
|---|---|---|
| Capital type | Conventional senior debt | Government-backed debt |
| Family | Debt | Debt |
| Size range | $500,000 — $25,000,000 | No floor — $1,150,000 |
| Typical cost | Prime + 1–4%. GSA + personal guarantee for closely held companies. | Prime + 3% (variable) or Residential mortgage rate + 3% (fixed). 2% one-time registration fee. |
| Speed to close | Months | Weeks to a few months |
| Eligibility | Operating business with 1.2–1.5x EBITDA coverage on proposed debt service. Audited or review-engagement financials typically required. | For-profit Canadian business with revenue under $10M. Excludes farming, charities, and a short list of restricted industries. |
| Use of proceeds | Expansion, Acquisition, Refinancing, Equipment, Real estate, MBO / buyout | Equipment, Real estate, Expansion |
| Status | Live — self-serve | Live — self-serve |
Choosing between them
Each side describes the scenarios where the program is the stronger fit. Most real-world deals end up in the “in common” section below — neither/nor.
When to choose
Pick CSBFP when the use of proceeds is equipment, leasehold, or real property under $1.15M, the business has revenue under $10M, and the sector isn't on the excluded list. The 2% one-time registration fee and Prime+3% rate beat anything conventional senior will offer for a similar-sized facility, and the government guarantee lets the lender stretch on a thinner credit profile.
When to choose
Pick conventional senior when the ask is over $1.15M, the use of proceeds isn't on the CSBFP eligible list (working-capital revolvers, acquisitions, refinances), or the business already has audited or review-engagement financials and 1.2–1.5x EBITDA coverage. Lower rate (Prime+1–4%) but tighter covenants and a more demanding package.
Most owner-operator deals at the $500K–$1.5M mark stack both: CSBFP covers the first $1.15M slice of equipment + real property at the cheaper rate, conventional senior covers the working-capital revolver and any balance above the CSBFP ceiling.
The CPA can look at your specific situation and tell you in one twenty-minute call which program (or stack) is the right structure — and what providers will want to see before the first conversation.