April 9, 2020 / 12:51 PM / in 4 months

Canadian banks to hand out interest-free loans to small businesses

FILE PHOTO: The Bank of Nova Scotia (Scotiabank) logo is seen outside of a branch in Ottawa, Ontario, Canada, February 14, 2019. REUTERS/Chris Wattie

TORONTO (Reuters) - Small and medium-sized businesses in Canada that have been affected by the coronavirus crisis were able to begin enrolling in a program to apply for interest-free loans of up to C$40,000 on Thursday, according to the Canadian Bankers’ Association.

As part of a number of measures announced by the federal government, the Canada Emergency Business Account (CEBA) program enables qualifying small businesses to apply online through their current lenders for the loans, a quarter of which is forgivable if repaid by Dec. 31, 2022.

Scotiabank (BNS.TO) has so far approved the loans for 3,750 customers, over C$150 million, the bank said in an e-mailed statement on Thursday.

In March, the “big six” lenders - Royal Bank of Canada (RY.TO), TD Bank (TD.TO), Scotiabank, Bank of Montreal (BMO.TO), CIBC and National Bank of Canada (NA.TO) - announced a coordinated effort to offer mortgage relief to customers suffering pay disruption as businesses grind to a halt.

Reporting by Anirban Sen in Bangalore and Nichola Saminather in Toronto; Editing by Shailesh Kuber and David Gregorio

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