What is the CSBFP maximum loan amount?

The three-tier limit structure

CSBFP loan sizing is not a single number — it is a nested structure of three limits that apply simultaneously. Getting the structure wrong is the most common reason borrowers leave money on the table or propose a loan that the lender has to restructure before it can be approved.

• Overall maximum per borrower: $1,000,000. No single borrower can have more than $1 million in outstanding CSBFP term loan balances at any one time. This is a per-entity limit — related businesses are treated separately if they are genuinely separate legal entities.
• Non-real-property sub-limit: $500,000 within the $1,000,000. Equipment, leasehold improvements, intangible assets (including franchise fees), and eligible working-capital costs share a $500,000 ceiling. A borrower who uses the full $1M must therefore use at least $500,000 for real property — a land or building purchase, construction, or substantial improvement.
• Intangibles and working-capital costs sub-limit: $150,000 within the $500,000. Franchise fees, intellectual property purchases, and working-capital term loan costs (pre-revenue operating expenses) are capped at $150,000 in aggregate. This sub-limit sits inside the $500,000 non-RP ceiling — it does not expand it.

The working-capital line of credit is a separate product and does not count toward any of the three term-loan limits above. More on the LOC below.

What each sub-limit means in practice

The limits interact differently depending on what a business is financing:

• Equipment-only or leasehold-only project: Hard ceiling of $500,000. A restaurant fit-out, a dental clinic build-out, or a manufacturing equipment upgrade — these all sit in the $500K bucket. No amount of real-property financing changes that ceiling.
• Real-property-only project: Up to $1,000,000. An owner-occupied building purchase or a commercial construction project can access the full $1M if the loan-to-value and debt-service coverage support it.
• Mixed project (equipment + building): Up to $1,000,000 total, with the non-RP portion capped at $500,000. Example: a $600K building acquisition plus a $300K equipment package would be $900K total — within the $1M overall limit, and the $300K equipment portion is within the $500K non-RP sub-limit. Both pass.
• Franchise purchase with leaseholds: The franchise fee sits in the $150K intangibles sub-limit. The leasehold build-out sits in the $500K non-RP bucket (but not the $150K sub-sub-limit). So a $200K franchise fee + $400K build-out = $600K total request. The franchise fee exceeds the $150K intangibles cap — the excess $50K cannot be CSBFP-financed. The build-out at $400K is within the $500K non-RP ceiling. Lender and applicant would need to restructure to keep the franchise-fee portion at or below $150K.

The working-capital line of credit: $150,000 on top

Separate from the term loan, the CSBFP working-capital line of credit (introduced in the July 2022 amendments) can provide up to $150,000 as a revolving facility. This $150,000 is in addition to the $1,000,000 term loan limit, not inside it.

A borrower who has maxed out the $1M term loan is still eligible for the $150K LOC. The combined maximum CSBFP exposure per borrower is therefore $1,150,000.

The LOC carries a higher rate cap (Prime + 5% versus Prime + 3% for the term loan) and a 5-year coverage period renewable in 5-year increments. For businesses that want both the term loan for capital assets and a revolving facility for working capital, this is the most attractive government-backed combination available in Canada.

How the $1M ceiling is tracked

The $1,000,000 limit applies to the outstanding balance of all CSBFP term loans, not the original amount advanced. As a borrower repays the term loan, room opens up — in theory, a business that has repaid its original CSBFP loan to below $1M could take a new CSBFP loan. In practice, lenders underwrite each application on its merits; a business that wants a second CSBFP loan after repaying a first is a normal transaction.

Related businesses — two companies with common ownership — are treated as separate borrowers if they are genuinely separate legal entities. However, ISED and participating lenders have discretion to treat related entities as a single borrower if the businesses are substantially integrated. Franchise networks where the franchisor controls multiple franchisee entities are a common area where this comes up.

Revenue cap and the borrower eligibility ceiling

The CSBFP loan limit and the borrower eligibility ceiling are two different things. The maximum loan is $1M (plus $150K LOC). The borrower must also have annual gross revenues of $10 million or less in the fiscal year preceding the application — a business with $12M in revenue does not qualify for CSBFP regardless of the loan amount requested.

For most small-business borrowers, the $10M revenue ceiling is not a constraint. The loan limit is the operative ceiling.

Does borrowing more make sense?

Higher loan amounts mean higher registration fees (2% of the loan, one time) and more total interest. A $1M CSBFP loan at Prime + 3% (7.95% at Prime 4.95%) amortized over 15 years carries a monthly payment of approximately $9,400 and total interest of about $692,000 over the full term. The 2% registration fee on a $1M loan is $20,000.

The right loan size is the one that produces a debt-service coverage ratio above the lender’s threshold (typically 1.25x), leaves the business with adequate operating cash, and aligns with the equity injection the owners can fund. Borrowing to the maximum because it is available is rarely the right answer — but borrowing less than you need because you misunderstood the sub-limits is equally costly.

Loan sizing checklist

Before submitting a CSBFP application, confirm:

1. The total requested loan is at or below $1,000,000.
2. The non-real-property component (equipment + leaseholds + intangibles + WC costs) is at or below $500,000.
3. The intangibles + working-capital costs component is at or below $150,000.
4. The LOC request (if any) is at or below $150,000 and is structured as a separate facility from the term loan.
5. The borrower’s gross revenues in the prior fiscal year were at or below $10,000,000.
6. The total outstanding CSBFP balance across all existing loans (if the borrower has prior CSBFP borrowing) plus the new request does not exceed $1,000,000 for term loans.

A CPA preparing the application package will confirm all six checks as part of structuring the file. Applications that pass the eligibility checklist but fail on sub-limit structure are a common cause of unnecessary lender re-work.