Driving Canada's Business Success

STAGE 2: STARTING YOUR BUSINESS

Eligibility/Loan Details:
CYBF Start-Up Loan

You have the idea, the passion and the confidence that entrepreneurship is the right career for you. Now what? Now, you need to create a solid business plan, get the right financing, get matched with an outstanding mentor and launch the business. Follow these steps to learn how to put your ideas in motion.

New businesses need start-up money…

Review the criteria below to determine if you are eligible for a CYBF Start-Up Loan. This section also gives you details about loan repayment. In the next few sections you’ll also learn about some of the other programs CYBF offers and their eligibility criteria: the CYBF-BDC Start-Up Financing Program, the CYBF Canadian Newcomer Entrepreneur Program, and the CYBF Succession Financing Program.

Eligibility Criteria for a CYBF Start-Up Loan:

Between 18-34 years old
Eligible to work in Canada (work permit holders not eligible)
Produce a complete and viable business plan
In business, fully operating, for less than 12 months
Lives in or operates the business in the community which offers the CYBF program
Has some training / experience related to their business idea
Agrees to work with mentor for a period of two years
Has a business idea that creates full-time sustainable employment for the applicant
Must hold at least 51% voting share in the business (if a partnership)
Not a full-time student
Loan proceeds may NOT be used for refinancing of existing debt
Loan proceeds may NOT be used to fund businesses that are sexually exploitive or that are inconsistent with generally accepted community standards of conduct and propriety, including those that feature sexually explicit entertainment, products or services; businesses that are engaged in or associated with illegal activities; businesses trading in countries that are proscribed by the Federal Government; and any other commercial activities inappropriate for government funding.

Partnerships:

If the business is a partnership, and only one partner meets the CYBF age criteria he/she must hold at minimum 51% of the partnership and meet all other CYBF criteria and be subject to the CYBF application process. If all partners meet the CYBF age criteria, then all are subject to the CYBF application process. If any partner is a minority shareholder and is over the CYBF age limit, they are not subject to the application process.

Incorporated Businesses:

If the business is incorporated, the applicant must be the majority shareholder, having at least 51% of the voting shares and be involved in the day-to-day management of the business. The applicant must also meet CYBF's age and all other criteria. If the business is incorporated and there are two or more shareholders and not one person holds the majority of the shares, then the shareholders who meet the CYBF age and all other criteria must hold the majority of the voting shares and are subject to the same application process. Any shareholder who meets the CYBF age criteria must be subject to the CYBF application process.

Loan Details:

Loan Terms

Amortized over 3 years if loan is $7,500 or less
Amortized over 5 years for loans over $7,500
Interest-only payments in the first year
Principal repayments are made in equal monthly installments together with interest, over the remaining two to four years, depending on the amount borrowed
No penalty for early re-payment

Interest Rates

First year, CIBC prime rate plus 2%
Second year, conditional on timely payments, CIBC prime rate plus 1%
Third and subsequent years, conditional on timely payments, CIBC prime rate
Current prime rates may be obtained from CIBC at http://www.cibc.com/ca/rates/index.html

Fees

$50.00 CYBF loan administration fee
$15.00 CYBF monthly administration fee