BDC is Canada's development bank: it lends directly to Canadian businesses, from $10,000 to several million dollars, and it does not give grants. The USA has no single equivalent: development finance runs through SBA loan guarantees, SBA microloans, and Treasury-backed community lenders.
Applies in: across Canada
BDC lends directly, and the USA has no single institution that does the same job. The Business Development Bank of Canada is a federal Crown corporation that lends its own money to Canadian small and medium-sized businesses, from $10,000 up to several million dollars, for growth, commercial real estate, equipment, technology, and cash flow. It requires, as its main criteria, a Canadian-based business with 12 to 24 months of revenue-generating operations and a profitable business. The United States splits the same work three ways: the SBA guarantees loans made by private lenders, with 7(a) loans capped at US$5 million; the SBA Microloan Program makes very small loans of up to US$50,000 through nonprofit intermediaries; and the Treasury's CDFI Fund supports community lenders that serve borrowers traditional lenders overlook. None of those is a grant, and BDC says so plainly: its financing must be repaid with interest.
This guide is general information about public programs, not financial advice for your business.
BDC describes itself as the bank devoted to Canadian entrepreneurs, and as Canada's only bank devoted exclusively to entrepreneurs. It provides financing, investment, and advice, and its mission, as stated in its own materials, is to build strong, resilient businesses that drive Canada's economic growth. That positioning matters because it explains BDC's risk appetite: BDC states that it takes on more risk where it matters, including businesses with elevated risk models and smaller and younger businesses that fall outside standard lending models. It is still a lender, not a grant maker, and every application undergoes due diligence before any loan offer is made.
The application runs through BDC directly. You start online for amounts over $100,000, a BDC advisor reviews the request and contacts you, and you need a Client Space account to complete the online process. BDC does a credit check on all loan guarantors and on members of the board of directors. You will need business information as listed in your business registry, owner and director details, a void business cheque, and government-issued photo identification, plus financial statements, a business plan, and cash-flow projections. Depending on the loan, you may also be asked for a purchase offer, an environmental report, an assessment report, or a list of leases.
BDC's main eligibility criteria, as stated on its financing FAQ page, are a Canadian-based business, between 12 and 24 months of revenue-generating operations depending on the loan type, a profitable business, and shareholders of legal age with good credit history. The same page restates the test in slightly different terms: Canadian operations, typically at least 12 months in business, consistent revenue or a clear path to generating income, profitability or a clear path toward it, cash-flow capacity to manage repayments, a good credit history that helps but is not the only factor, a solid business plan, and owners who have reached the age of majority.
Two practical consequences follow. First, a business with less than 12 months of operations should not start with a BDC application. BDC directs those businesses to its partners, and the partner that matters most for young founders is Futurpreneur, covered in the companion guide in this series. Second, a weak credit score does not automatically disqualify a business, because BDC states that it looks at overall potential, cash flow, and management, not just the credit score. A weak plan with weak cash flow will still be declined, and a strong plan with a thin credit file may still be approved. The gate is the whole file, not one number.
Some businesses are not eligible at all. BDC's FAQ page lists businesses that promote violence or cruel behaviour, engage in sexual exploitation, or promote sexually explicit content, and industries including charitable, religious, and fraternal organizations, unions and political or advocacy organizations, government ownership, private schools, medical and personal care centres, market speculation, residential properties, cannabis, virtual currency and NFTs, financial services, bars and lounges, and gambling operations. Check that list before you spend time on an application for a business in one of those categories.
BDC publishes no fixed interest rate, and this guide states none. Its FAQ page explains the calculation as a current floating base rate plus a variance based on personal and business information, so rates vary from one client to another. Some BDC loans are non-blended, meaning the monthly principal payment stays the same while interest is calculated on the remaining balance, so payments become smaller over time as the balance falls.
Repayment terms vary by loan type. BDC gives one worked example: for a 60-month Small Business Loan, the first 6 months are interest-only with principal payments deferred, and from month 7 onward the borrower makes regular monthly payments until the loan is repaid. Treat that as an example of one product's structure, not as a promise for every BDC loan. Early repayment options depend on the specific product and loan agreement. No down payment is required for a BDC business loan generally, although certain purchases such as real estate may require one, and collateral depends on the type of loan selected. A business with solid cash flow but no assets still has options, according to BDC.
The first US door is the SBA guarantee. The SBA does not lend directly under 7(a). A private lender lends the money, the SBA guarantees part of the lender's loss, and the borrower repays the lender in full. The maximum 7(a) loan is US$5 million, the guarantee is 85% for loans of US$150,000 or less and 75% for larger loans, and maturities run up to 10 years for working capital and up to 25 years for real estate. The borrower always works directly with a participating lender, not with the SBA. Canada's parallel to this door is the CSBFP, not BDC: the CSBFP is also a guarantee to a private lender, capped at C$1.15 million per borrower, applied for through the borrower's own bank. The CSBFP vs SBA guide on this site covers that comparison in full, and this guide does not repeat its fee and category detail.
The second US door is the SBA Microloan Program, covered in the Futurpreneur guide in this series. The SBA funds nonprofit intermediaries, which lend up to US$50,000 to small businesses, averaging about US$13,000, with management and technical assistance alongside the loan. It is the US door for very small loans, and it has no BDC parallel, because BDC's floor is $10,000 and its main criteria require revenue history that a microloan borrower may not yet have.
The third US door is community development finance. The US Treasury's CDFI Fund exists to strengthen Community Development Financial Institutions: specialized institutions, including credit unions, microenterprise funds, development banks, and loan funds, whose mission is to provide financial services to people and businesses typically overlooked by traditional providers. The CDFI Fund provides equity, loans, grants, and technical assistance to CDFIs, and CDFIs in turn lend to homeowners, small businesses, and non-profit organizations in distressed and underserved communities. A CDFI is not a single national bank. It is a local or regional lender, certified and supported through the Fund, and the borrower deals with the CDFI itself. For a Canadian reader, the closest parallel is not BDC but the network of community lenders and Community Futures organizations in Canada, which BDC also points to through its partner pages.
If your business operates in Canada, has 12 to 24 months of revenue history, and needs direct lending for a growth project, equipment, real estate, or technology, start with BDC. Bring financial statements, a business plan, and cash-flow projections, and expect a credit check and a due-diligence review. If your business is younger than 12 months, start with Futurpreneur if you are 18 to 39, or with the CSBFP through your bank if the use of funds fits its categories. If your business operates in the United States, start with a participating SBA lender for a larger guaranteed loan, a microloan intermediary for a very small loan, or a CDFI if traditional lenders have overlooked your community or your file. If you operate in both countries, keep the two sides separate: BDC finances the Canadian operation, and the SBA and CDFI doors finance the US operation, on each operation's own eligibility.
| BDC, loan range | $10,000 up to several million dollars |
|---|---|
| BDC, online application start | Start online for amounts over $100,000 |
| BDC, revenue history | 12 to 24 months of revenue-generating operations, depending on loan type |
| SBA 7(a), maximum loan | US$5 million |
| SBA 7(a), guarantee | 85% for loans of US$150,000 or less, 75% above that |
| SBA microloan, maximum | US$50,000 |
| SBA microloan, average | About US$13,000 |
BDC figures are Canadian dollars. SBA figures are US dollars. BDC publishes no fixed interest rate: its rate is a floating base rate plus a variance set for each borrower, so no rate is stated here.
BDC is the Business Development Bank of Canada. BDC calls itself the bank devoted to Canadian entrepreneurs. It lends to small and medium-sized businesses and advises them. Borrowers repay every loan with interest. BDC says so itself on its FAQ page, where it calls itself a commercial bank offering long-term business financing. People looking for grants are sent to the federal Business Benefits Finder instead.
Loans run from $10,000 up to several million dollars for large growth projects. An application for more than $100,000 starts online, and a BDC advisor then guides the next steps. BDC lists growth, commercial real estate, and equipment purchases among the project types it funds. It also funds technology upgrades and cash-flow needs. No single maximum is published, because the amount depends on the project and the business. Approval turns on financial health, credit profile, and growth potential. No applicant is guaranteed approval.
The business must be based in Canada. It needs 12 to 24 months of revenue-generating operations, depending on the loan type. It must be profitable. Its shareholders must be of legal age with good credit history. Start-up financing has its own version of the test: a Canadian base, at least 12 months operating, and a good track record. Businesses under 12 months are sent to BDC partners. Some businesses cannot apply at all. Charitable, religious, and fraternal organizations are on the excluded list. So are government-owned businesses. Gambling, bars and lounges, cannabis, and financial services are excluded too, along with others named on BDC's FAQ page.
No. The work BDC does is split across three US systems. First, the SBA guarantees loans made by private lenders. Its 7(a) program caps at US$5 million, with a guarantee of 85% for loans of US$150,000 or less and 75% above that. Second, the SBA Microloan Program lends up to US$50,000 through nonprofit intermediaries. Third, the US Treasury's CDFI Fund strengthens Community Development Financial Institutions, which lend to small businesses in underserved communities. A US business that wants direct development lending has to assemble the equivalent from those separate doors. There is no one bank behind them.
BDC lends directly: the money is BDC's money, BDC makes the credit decision, and BDC is repaid by the borrower. The CSBFP, the Canada Small Business Financing Program, is a guarantee: a private bank, credit union, or caisse populaire lends its own money, and the federal government covers part of the lender's loss if the loan defaults. The CSBFP caps at C$1.15 million per borrower and is applied for through the borrower's own financial institution. BDC is covered in this guide as the direct lender; the CSBFP is covered in full in the companion CSBFP vs SBA guide linked below.
Not directly from BDC on its main criteria, which require 12 to 24 months of revenue-generating operations. BDC itself directs businesses with less than 12 months of operations to its partners, including Futurpreneur for founders aged 18 to 39, which offers up to $75,000 with mentorship. A business that has operated for at least 12 months but is not yet profitable should expect BDC to weigh its overall potential, cash flow, and management, not only its credit score, but approval is never guaranteed and every application undergoes due diligence.