3 Amazing Government Funding Program Types to Try Right Now

The Canadian government has some amazing government funding programs that small business owners and startups can apply for.

This year, one of the best years to seek government funding is full of options for pre-revenue start-ups, existing business owners bouncing back in this economy as well as those looking for further advance and growing their businesses.

With the economy being in shambles, interest rates are high via banks, making it extremely difficult and expensive to borrow money; hiring is getting costly with such high unemployment rates (more so people not wanting to work)…it’s all a mess. This means that everyone needs that extra cash to make it though.

The good thing is that the Canadian government has multiple program types to help get business owners on track – and funded!

Government Funding Programs

 Before we get into the various government funding program types, it is a good idea to first understand that government funding comes from multiple levels of the Canadian government.

Local government funding

Initially, it is always best to look locally for funding. This means you own city/town; or your own suburb, as these programs are often much easier to obtain funding acceptance from. Especially if the business you have is run, operates, and targets customers in your own city. Every city is looking to give back to boost the local economy. This money is considered local government funding.

Local government funding often has the fewest funding options, but they are much easier to obtain when available.

Provincial government funding

From there, to expand your search and reach wider, consider provincial government funding options, or inter-provincial options. This means that your province is trying to boost entrepreneurship and grow it’s the provincial-level economy – so they give the money to deserving businesses.

Provincial government funding is more available as a business owner in one city may benefit from various other locations and governments within eh the same province. In other words, the provincial government have more money to dedicate towards entrepreneurship than your local government.

Federal government funding

Lastly, looking far and wide for government funding options, you want to consider the federal government of Canada – as it covers all cities, and all province and often has the most options for small business owners.

Federal government funding options are often able to cover the majority of businesses as they have the most money and are more likely to be available for many more funding needs, industries, and locations across Canada.

The recommended step to consider when seeking government funding for your business is to utilize all 3 levels of government, to maximize your potential.

To see all available government funding options across Canada, use the Funding Database.

3 Government Funding Program Types

To get into some more specifics regarding government funding program types, here are the 3 top funding option types to consider:

1.       Government Grants
2.       Government Loans
3.       Tax Breaks or Tax Credits

Each of these 3 government funding types can be further broken down into more specific options, each with its own advantages and disadvantages, but definitely amazing options to get your business funding via the Canadian government.

Government Grants

A government grant is often one of the more favorable funding types offered by the various local, provincial, and federal governments agencies. In most cases, a government grant is often considered” free money”, due to the fact that they don’t need to be repaid back.

It is important to note that there are different government grants, however, including:

•         Non repayable government grants
•         One time and renewable grants
•         Partial contributions

The non-repayable government grants are exactly as they sound – money that is provided to you as a business owner to cover the various expense you may have, however no need to pay the funds back – ever.

The one-time and renewable grants are grant options that are provided to business owners seeking funding to cover a one time purchase, such as paying for renovations, or improving equipment…etc; while the renewable grants are options that fund ongoing expenses, such as employee hiring/wages; or training costs.

 The partial contributions are much like the non-repayable grants, however often will require an initial deposit or funding by the business owner directly (as well). The partial can mean any percentage based on what the grant agency agrees to. For example: if you are applying for $50,000; the approved partial contribution may be provided of $50,000, assuming you are also putting $50,000 of your own money in.

The partial aspect is helpful if you already have money to put towards your business – if not, probably a good idea to stay away.

It is important to keep in mind that while government grants are preferred, they are also very competitive and often not available for all types of funding expenses.

Government Loans

Government loans, much like a traditional bank loan, would be simply money you borrow from the government agencies, or can often be backed by the government – to give your business a boost with the money you need to cover those expenses you may have.

The various loan types available include:

•         No Interest and Low-Interest Loans
•         Conditionally Repayable Loans
•         Government Guaranteed Loans

The loans, be it a no-interest or low-interest, they are much like a traditional bank loan. You borrow the money from a specific government funding agency and you use it for your business. The loan, interest, and repayment terms are often negotiated to benefit your business.

Unlike a bank loan that only wants your interest money – a government loan is out to help you succeed.

The conditionally repayable loans are same as above; however, conditions are placed and often negotiated to help you as the business owner get the most out of the borrowed money. Often a condition may be in place to not have to pay the loan back until you hit profit; or no payment for the first year…etc; this gives you the most opportunity to succeed – again, unlike a bank loan that demands an interest payment a month after borrowing.

With the government guaranteed loans, the government is your co-signer on the loan application. This means that they are taking on a percentage of the risk with you – and in case things don’t go as planned, you are not on the hook for the entire amount borrowed!

A government loan is a great way to fund your business quickly – with higher approval rates over government grants.

Tax Breaks and Tax Credits

 In addition to government grants and government loans, tax breaks and credits are often free money as well. However, these types of government programs are often last to consider as you first have to have spent the money in order to claim it and get the break or credit.

Most business owners need the funds “now”; whereas the tax credits often come around tax time as a refund. While this is just as good as a grant, many business owners shy away – but something to definitely not miss as it has amazing opportunities for a business owner to benefit

To see all government options, including grants, government loans and tax breaks, see the Funding Database and benefit from the expert help and guidance.