Business loans in Ontario
From Toronto and the GTA to Ottawa, Hamilton, London and the north, Ontario businesses use the same core products as everywhere in Canada. The difference is in the paperwork lenders read.
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Local economy
Where Ontario revenue comes from
Ontario is the country's most varied provincial economy. The Golden Horseshoe around Toronto and Hamilton carries finance, head offices and a long manufacturing tradition, with auto assembly and parts plants spread through Oshawa, Windsor, Cambridge and Alliston. Kitchener-Waterloo and Ottawa lean toward software and technology services. Southwestern Ontario grows field crops and greenhouse produce, the Niagara Peninsula is known for tender fruit and wine, and the north depends on mining, forestry and the service towns that support them. Around the GTA, a steady flow of residential and commercial building keeps the trades busy year round.
Tax accounts lenders check
Ontario uses the Harmonized Sales Tax (HST) at 13%, administered by the Canada Revenue Agency (CRA). HST you collect is not your money: lenders reading your bank statements often look for regular HST remittances, and CRA arrears for HST or payroll source deductions can slow or stop an approval.
What fits
Funding that fits Ontario businesses
- Working capital for payroll, rent and inventory between busy periods.
- Equipment financing for trucks, kitchen equipment, machinery and tools.
- Lines of credit for trades and B2B businesses that wait on customers.
- Invoice factoring for trucking, staffing and wholesale businesses with slow-paying customers.
Local industries
- Manufacturing: Parts shops supplying auto and industrial customers often wait weeks for payment. Invoice factoring or a line of credit bridges those terms, and equipment financing spreads the cost of new machines.
- General contractors: GTA renovation and building contractors pay crews and suppliers before progress draws arrive. A revolving line of credit covers the gap between each draw without taking a new loan every job.
- Restaurants: Toronto and Ottawa restaurants with steady card sales often look at working capital repaid from deposits, or equipment financing when a kitchen needs a new walk-in, range or hood.
Paperwork
What to have on file
- Business registered with the Ontario Business Registry (or federally incorporated)
- WSIB coverage, if your industry requires it: some construction lenders ask for a clearance certificate
- HST account in good standing with the CRA
Public help
Free public help in Ontario
- Ontario Small Business Enterprise Centres: provincially funded local offices offering free advice to people starting or growing a business.
- FedDev Ontario: the federal development agency for southern Ontario.
- FedNor: the federal development agency for northern Ontario.
- CSBFP: government-backed loans through participating banks and credit unions.
No affiliation implied.
FAQ
Ontario business funding questions
Will a lender ask for a WSIB clearance certificate?
Some will, especially for construction trades and subcontractors. A current clearance from the Workplace Safety and Insurance Board shows your premiums are paid, and general contractors often need one before they release payment to you anyway. Having it ready avoids a delay.
My business is registered provincially. Does that matter?
No. Lenders accept both Ontario corporations and federally incorporated companies. What they want is a current record in the Ontario Business Registry or the federal registry, a business bank account in the company's name and the most recent six months of statements.
I run a seasonal cottage-country business. Can I still apply?
Yes. Marinas, outfitters and resorts in Muskoka or the Kawarthas often show strong summer deposits and a quiet winter. Lenders look at the full six months of statements, so apply when those months reflect your real trading pattern, and explain the seasonality up front.
Do you refer auto parts suppliers?
Yes. Tier-two and tier-three suppliers along the 401 corridor often carry long receivables from larger manufacturers. Factoring those invoices or a line of credit are the usual fits, and equipment financing is common for CNC, stamping and welding machinery.
Short form first, a phone call second, then offers you can accept or ignore. Network minimums*: 1 year in business, $20,000 monthly bank deposits, 500+ credit. How it works. *Not guaranteed.
Canadian law
The federal 35% interest rate cap
Since January 1, 2025, Canada's Criminal Code sets the criminal interest rate at an annual percentage rate above 35% on the credit advanced (section 347). "Interest" there includes fees, commissions and penalties tied to the loan, not only the stated rate.
Some business loans are exempt under the Criminal Interest Rate Regulations (SOR/2024-114), only when the borrower is not an individual and the money is for a business or commercial purpose:
- More than $500,000 advanced: the section 347 cap does not apply.
- More than $10,000 and up to $500,000: exempt only if the APR is 48% or less.
- $10,000 or less: the 35% cap applies.
Ask any lender for the APR in writing before you sign. Sources: Criminal Code, s. 347 and SOR/2024-114 (Justice Canada). General information, not legal advice.
See your options in Ontario
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