A major federal small business lending program continued with record losses last year, likely due to declining numbers of applicants and a widening between claims and fee revenues, according to a report by the Canadian Press.
The report claims the Canada Small Business Financing Program reached a record $113 million in loss claims for 2010, representing a substantial gap from the $957 million that was guaranteed to businesses through the program.
Minister of Industry Tony Clement, who heads the program, maintained that the fund "continues to be a successful mechanism for facilitating asset-backed debt financing to business."
"The number of businesses helped by the program hit a new low in 2009-2010 - about 7,500, half the number of a decade ago - but the annual loan value still hit nearly a billion dollars because loan limits were doubled to $500,000 last year," wrote Dean Beeby for the source.
While the program has experienced losses in recent years, the global economic recession has taken much of the blame for it, as small businesses and banks began tightening their assets and credit policies.
