BDC launches Community Banking to help boost Canada’s active small business count by 10% and help grow the economy

Highlights:

• BDC to partner with 80+ local organizations to help make it easier for SMEs to access financing
• The focus will be on entrepreneurs with unconventional business models, those in rural/remote areas, little credit history, or from younger age groups
• Expected outcomes: up to 100,000 small business owners accessing new financing in the next 10 years, potentially growing the number of active small businesses in Canada by 10%

SASKATOON, November 21, 2024 – The Business Development Bank of Canada (BDC), Canada’s only bank devoted exclusively to entrepreneurs, today launched a new Community Banking initiative created to help Canada’s economic performance and help reverse a decades-long trend that saw 100,000 fewer Canadians starting businesses than 20 years ago.

“Entrepreneurs are the dreamers, the doers, that build businesses, communities, and economies. We simply can’t afford to let any untapped potential go to waste, and having more productive businesses is one of the best answers to Canada’s economic challenges. By working collaboratively with community-based lenders across the country, we hope to launch 100,000 new small business success stories in the next decade,” said Isabelle Hudon, President and CEO, BDC. “As Canada’s development bank, we see entrepreneurs defy the odds every single day. We need to put the odds back in their favor, and working with our 80 partners will allow us to accelerate the pace in getting more entrepreneurs financed to grow. Canada’s economy needs it now more than ever, and there’s not a minute to waste.”

Data consistently shows not all entrepreneurs have the same access to the financing they need to grow their business. OECD research shows commercial financing to Canadian companies grew by 165% since 2011, but the percentage of these new loans going to SMEs decreased from 16% to 8.6%. Canada’s SMEs have fewer and fewer options for financing compared to their G7 peers. This is especially true for small businesses with unconventional business models, those in rural/remote areas, little credit history, from younger age groups, or from underserved or underrepresented groups.

All of these groups have different needs to grow their businesses, and therefore there isn’t a one-size-fits-all solution. Building off BDC’s success in working in partnership with regionally-focused lenders, BDC’s new Community Banking initiative will help up to 80 community-based lending organizations grow their lending and advisory capabilities. By helping the helpers of small businesses, BDC is working to create a stronger support system for Canada’s entrepreneurs in every part of the country. 

"BDC’s Community Banking is about taking collaboration to the next level so that no entrepreneur is left behind. Community organizations know the small businesses in their communities better than anyone. Boosting their capabilities to finance those hidden SME gems is the most efficient path to creating the next generation of entrepreneurial trailblazers,” said Miguel Barrieras, Chief Community Banking and Impact Officer.

Advice and guidance on how to use financing to its full potential is a critical factor in entrepreneurial success, with BDC clients growing twice as fast as the national average. By combining the know-how of local organizations and BDC’s expertise in financing and advice, the Community Banking initiative aims to multiply the impact among entrepreneurs that are ready and able to grow. 

BDC’s Community Banking initiative will roll out nationwide in the coming months, with a focus on community-based organizations committed to fostering small business growth and community engagement. Interested organizations can reach out to BDC via bdc.ca’s Community Banking’s page for more information.

“What we’ve seen so far from working with organizations such as Futurpreneur, Evol and NACCA is that by working together, it creates an exponential impact for entrepreneurs. They get the best of both worlds, the community groups that know and support them best and the financial weight of BDC behind them,” said Adil Hassam, Vice President, Community Banking.

As a self-sustaining financial Crown corporation, BDC does not offer grants or subsidies. As a result, the Community Banking initiative will offer commercial loans that must be repaid. The Bank provides all of services at no cost to Canadian taxpayers even though it takes on more risk than the private sector. Thanks to strong fiscal performance in fiscal 2024, BDC’s profitability allowed it to declare a $337 million dividend back to the Government of Canada.

About BDC: 80 years as Canada’s bank for entrepreneurs  

BDC is a partner of choice for all entrepreneurs looking to access the financing and advice they need to build their businesses and tackle the big challenges of our time. Our investment arm, BDC Capital, offers a wide range of risk capital solutions to help grow the most innovative firms. BDC’s development role means we are in a state of perpetual evolution – wherever entrepreneurs go and whatever the Canadian economy needs – we will be there to help them defy the odds. 80 years later, that commitment remains very much alive. The financial value of BDC’s services is estimated to add $23.6 billion in GDP to Canada’s economy over the next five years. We are one of Canada’s Top 100 Employers and Canada’s Best Diversity Employers and the first financial institution in Canada to receive the B Corp certification in 2013. For more information on our products and services and to consult free tools, templates and articles, visit bdc.ca or join BDC on social media.  

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