Business Development Bank of Canada (BDC) and Export Development Canada (EDC) announced that they will jointly offer $50m in new financing over two years for tech firms that are engaged in and have plans for international business expansion.
With the agreement, tech firms will have the access to working capital loans of up to $1m. To be eligible for financing, tech firms must earn at least 50% of their sales from exports or have an export business strategy that the loan is intended to support.
Under the partnership, BDC will manage the end-to-end transaction, including due diligence, authorization, disbursement, asset management, loan enforcement and special risk functions. EDC will act as a participant and take a participation interest in each loan, to create a 50-50 risk sharing.
BDC executive vice president for financing Pierre Dubreuil said the partnership will be able to help more of Canada’s highly innovative tech entrepreneurs gain scale globally.
“As the only bank devoted exclusively to entrepreneurs, BDC is eager to help promising tech firms, which sometimes have difficulty accessing financing due to a lack of tangible assets. EDC’s network can be very appealing to these businesses, which have adopted an export mindset because their technology can be deployed globally,’ Dubreuil said.
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