How to Get a Small Business Loan in New Brunswick: Quick Guide for NB Entrepreneurs

Are you a small business owner in New Brunswick looking for financing options? Whether you’re just starting out or looking to expand, securing a New Brunswick small business loan can provide the necessary capital to help your business grow. In this article, we’ll explore the types of small business loans available in New Brunswick and where you can go to get one.

Key Takeaways

• Small business loans in New Brunswick include term loans, lines of credit, equipment financing, merchant cash advances, purchase order financing, invoice factoring & financing, and SR&ED financing
• Banks, credit unions, and government programs are all options for getting a small business loan in New Brunswick.
• Research and compare loan options to find the best fit for your business.

Types of Small Business Loans

When it comes to financing your small business in New Brunswick, there are numerous types of loans available to you. Each type of loan has its own advantages and disadvantages, so it’s important to understand which option is right for you. Here are the most common types of small business loans available:

Term Loans

Term loans are a popular option for small businesses. With a term loan, you receive a lump sum of money upfront and repay the loan over a set period of time with interest. The repayment term can range from a few months to several years, depending on the lender and the amount borrowed. This type of loan is best for businesses that need a large amount of capital upfront and can afford to make regular payments over time.

Lines of Credit

A line of credit is a type of loan that gives you access to a pool of funds that you can draw from as needed. You only pay interest on the amount you borrow, and you can repay the loan at any time. This type of loan is best for businesses that need flexible funding for ongoing expenses or unexpected costs.

Equipment Financing

Equipment financing is a loan specifically designed to help you purchase equipment for your business. The equipment itself serves as collateral for the loan, which means you may be able to secure a lower interest rate. This type of loan is best for businesses that need to purchase expensive equipment upfront but can’t afford to pay for it all at once.

Merchant Cash Advances

A merchant cash advance is a type of loan that gives you an upfront sum of money in exchange for a percentage of your future sales (typically credit card sales). This type of loan is best for businesses that need quick access to cash but have inconsistent revenue streams (such as seasonal businesses).

Purchase Order Financing

Purchase order financing is a loan that helps you fulfill large orders from customers. The lender provides you with the funds needed to purchase the materials or products required to fulfill the order. Once the order is complete, you repay the loan with interest. This type of loan is best for businesses that need to purchase materials or products upfront to fulfill a large order.

Invoice Factoring and Financing

Invoice factoring and financing are two types of loans that help you get paid faster for outstanding invoices. With invoice factoring, you sell your outstanding invoices to a lender at a discount in exchange for immediate cash. With invoice financing, you use your outstanding invoices as collateral for a loan. This type of loan is best for businesses that have outstanding invoices and need cash flow to cover ongoing expenses.

SR&ED Financing

SR&ED financing is a loan designed to help businesses cover the costs of scientific research and experimental development. The loan is based on the tax credits you expect to receive from the Canadian government for your research and development work. This type of loan is best for businesses that are engaged in scientific research and development and need funding to cover the costs.

Where to Get a Small Business Loan in New Brunswick

If you’re looking for a small business loan in New Brunswick, there are many options available to you. In this section, we’ll explore the different types of lenders and government agencies that can provide financing for your business.

Government Agencies

There are several government agencies that offer funding and support for small businesses in New Brunswick. These include:

• Business Development Bank of Canada (BDC): BDC is a federal agency that provides financing and advisory services to small and medium-sized businesses across Canada. They offer a range of financing options, including term loans, working capital loans, and venture capital.
• Atlantic Canada Opportunities Agency (ACOA): ACOA is a federal agency that provides funding and support for businesses in Atlantic Canada. They offer a variety of financing options, including loans, loan guarantees, and equity investments.
• Export Development Canada (EDC): EDC is a federal agency that provides financing and insurance solutions for Canadian exporters. They offer a range of financing options, including working capital loans, term loans, and guarantees.

Banks and Credit Unions

Banks and credit unions are also a good source of financing for small businesses in New Brunswick. Some of the major banks and credit unions in the province include:

• Royal Bank of Canada (RBC): RBC offers a range of financing options for small businesses, including term loans, lines of credit, and business credit cards.
• Scotiabank: Scotiabank offers a range of financing options for small businesses, including term loans, lines of credit, and equipment leasing.
• Credit Unions: There are several credit unions in New Brunswick that offer financing for small businesses, including UNI Financial Cooperation (which offers a commercial mortgage and interim financing), Coast Capital Savings, and Meridian Credit Union.

Online Lenders

Online lenders are becoming an increasingly popular option for small businesses in New Brunswick. Some of the top online lenders in Canada include:

• Lending Loop: Lending Loop is a peer-to-peer lending platform that connects investors with small businesses looking for financing.
• OnDeck: OnDeck is an online lender that offers term loans and lines of credit to small businesses with less-than-perfect credit.

Community Business Development Corporations

Community Business Development Corporations (CBDCs) are non-profit organizations that provide financing and support for small businesses in rural communities throughout Atlantic Canada. To find a CBDC in New Brunswick near you, check out Find My CBDC – NB.

Frequently Asked Questions

What are the eligibility requirements for small business loans in New Brunswick?

Eligibility requirements for small business loans in New Brunswick vary depending on the lender and the type of loan you are applying for. Generally, lenders will look at your credit score, business revenue, and financial history to determine whether you are a good candidate for a loan. Some lenders may also require collateral or a personal guarantee to secure the loan.

What about small business grants in New Brunswick?

There are many! Check out our big list of NB business grants here.

What resources are available to help me start a small business in New Brunswick?

There are many resources available to help you start a small business in New Brunswick, including Community Business Development Corporations, mentorship programs, and networking events. The Government of New Brunswick offers several programs and services to support small business owners, including funding programs, training and coaching services, and support for entrepreneurs. You can also seek guidance from NB business associations and chambers of commerce.