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4 Top Business Financing Options for a Start-Up in Quebec

One of the biggest challenges that entrepreneurs and start-ups face is finding a way to finance their endeavors and manage their cash flow. You already know that in order for you to start any business venture your brilliant ideas need to be backed up by enough capital. You can use the funding to tackle your expenses even if you’re just looking to expand — from recruiting great talent to paying off your student loans and establishing your credibility, extra funds can be a big help.

If you’re established in Quebec, there are a number of ways you can support your business venture. Funds are available from a few different sources, but like you might assume, not all of them are going to be suitable for you. Here are just a few business financing options to consider if you have decided to boost your business ideas:

 

 

Entrepreneurs - business financing

UK in Canada / Flickr / Attribution-NonCommercial-NoDerivs 2.0 Generic (CC BY-NC-ND 2.0 ) CEO of Hootsuite Ryan Holmes with Sir Richard Branson, Founder of Virgin Group — two of the most widely recognized entrepreneurs.

1. Government Grants

There are many different grants entrepreneurs like you can use to finance your business venture. But when it comes to government grants of any type — from awards to donations and endowments — bear in mind that the criteria for approvals is extremely particular. Most grants are not only targeting a specific business, but also a specific location or product.

Government and NGO Funding - business financing

Howard Lake / Flickr / Attribution-ShareAlike 2.0 Generic (CC BY-SA 2.0

Available grants for entrepreneurs in Quebec include:

  • Jeunes Promoteurs – provides financial help for entrepreneurs starting their first business. The age requirements are that you have to be between 18 and 35 years old. There are 3 components to the grant: Preparation of a business plan (75% of expenses covered); Establishment of a first business (50% of expenses covered if you create at least 2 jobs); and, Entrepreneur training (100% of expenses covered).
  • Fonds de développement des entreprises d’économie sociale – the capital provided by this grant cannot exceed 80% of eligible expenditures. The grant could finance one or more aspects of your social enterprise development project: capital expenditures for expanding or starting your business; acquisition of technology, software or patents; need for operating working capital. In order to be eligible, your business needs to be financially viable, produce goods or services and create long-term goals.

Make sure you check the specific criteria for each available grant, before you apply.

2. Financing from NGOs

In addition to government grants, there is a certain number of non-government funding available to entrepreneurs. Some NGOs may give you a certain amount of money, while others may finance a certain percentage of your start-up. NGO funded grants include the following:

  • Fondation Montréal Inc’s Grant provides up to $30,000 to help cover 25% of your start-up costs. Eligible candidates for this grant need to be Canadian citizens between the ages of 18 and 35, willing to start up a business in a borough or a reconstituted city of Montreal.
  • Futurpreneur Canada Expansion Program is another of the many programmes that can support the expansion of your business. The criteria is similar to that of the Foundation Montreal Inc’s Grant. The applicant’s age (must be between 18 and 39) and residency status (they must be Canadian or a permanent resident of Canada) are key eligibility factors to secure the funds.

3. Crowdfunding

Crowdfunding is one of the alternative methods of raising the capital you need. For all those unaware of what crowdfunding is — it’s the collection of financial contributions from people not usually connected to the financial sector.

Crowdfunding - business financing

Rocio Lara / Flickr / Attribution-ShareAlike 2.0 Generic (CC BY-SA 2.0

This option is available via crowdfunding platforms on the internet such as Ecloid, Fundo and others. It’s not only a great way to involve the public while marketing your start-up and products, but it also allows you to offer rewards and take pre-orders while collecting donations. The cons of crowdfunding, though, include the risk of having your ideas copied by other companies or big corporations. Alternatively, you might consider selling or pitching some of your ideas to possible buyers. The one huge pro of this fundraising method is that you get to test the validity of your start-up or the launch of a new product by getting immediate responses from the public.

4. Private Sector and Personal Assets

Personal Assets - business financing

Sharon Drummond / Flickr / Attribution-NonCommercial-ShareAlike 2.0 Generic (CC BY-NC-SA 2.0) Some lenders require you to invest a certain amount of personal capital

Most banks will require you to have a starting capital before they lend you any money. In addition, there are a number of documents you need to prepare in order to apply — a cash flow forecast and a credit score statement among others. If you don’t have the time, or you don’t like waiting, you can instead use personal assets to finance your business. There are plenty of lenders that provide business loans against personal possessions such as jewelry, watches and other valuables.

Lending against personal possessions is a particularly good option for entrepreneurs who do not have enough or any capital to start their business off. Furthermore, there’s no need for countless application forms and filling specific criteria, which makes the process fast and user-friendly. In addition, business loans from private companies, unlike a line of credit, do not impact you personal or business credit.

Which of the financing options described above are you going to try out? Let us know in the comment section below.

Top Grants for Small Businesses in Alberta!

Are you looking to finance your ideas and make your small business bigger? There are 3 major ways to receive the capital you would use to fund your endeavors — loans, government supported financing programs and business grants.

Business grants are available to small businesses and entrepreneurs in Alberta. Grants of any type — awards, contributions, donations, endowments and others — all have really specific criteria. Since most of the grants are targeted at very particular kinds of businesses, not everyone will qualify for all of the grants.

You should carefully examine the criteria to make sure you are applying for a grant you are eligible for. Check out these three categories of business grants to see if any of them could help your business.

 

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thetaxhaven / Flickr / Attribution 2.0 Generic (CC BY 2.0)

Agriculture and Agribusiness Grants for Small Businesses

Based on the large number of grants available for Agriculture and Agribusiness, this is just one of many industries that have a high demand for grants and funding. To quote a popular saying, “When there’s funding, there’s business,” and vice versa.

Agriculture - grants for small businesses

Chesapeake Bay Program / Flickr / Attribution-NonCommercial 2.0 Generic (CC BY-NC 2.0)

1. Advance Payments Program This is one of the possible options for funding. It could provide you with easier access to credit through cash advances. The maximum cash advance available to each business is $400,000. One of the pros of the programme is that the federal government covers the interest on the first $100,000 issued per production period.Furthermore, the programme guarantees lower interest rates than normal loans. The deadline for repaying the cash advance is at the end of each production period.

The Advance Payment Program is a great way for businesses specializing in crop and livestock production to meet their financial obligations. Many participating organizations have already helped out a large number of small businesses.

2. AVAC Ltd Programmes Looking for a way to invest in your innovative ideas? If their implementation will help Alberta’s agrivalue and renewable resources ventures, then AVAC Ltd.’s grant might be right for you! Avac Ltd. is an Alberta-based, not-for-profit, private company. The grants they provide are designed especially for Alberta companies, research and academic organizations, and stakeholders in the value-added industry:

  • Idea Builder Program — capital of up to $25,000 for smaller-scale projects that add value to agricultural commodities.
  • Pre-Commercial and Entrepreneurial Program — over $25,000 for bigger projects, adding value to agricultural commodities.
  • Research and Strategic Initiatives — assistance to research and academic institutions in recruiting scientists and researchers, engaged in agrivalue-added activities.
  • Knowledge Investment Program — up to $25,000 aimed at businesses developing projects that advance agrivalue knowledge within Alberta.

R&D Technology Grants for Small Businesses

R&D - grants for small businesses

Intel Free Press / Flickr / Attribution-ShareAlike 2.0 Generic ((CC BY-SA 2.0)

1. Engage Grants The Engage grants are a brilliant way for you to finance an R&D project and solve a problem specific to your company. The funding is up to $25,000, managed by an academic researcher and a Canadian university. The possibility of being approved for such grant is extremely high — the success rate for typical applications is around 90%.

The evaluation times are typical for academic grants — up to 6 weeks from receipt of the application. The duration of the award is up to 6 months. The specifics of this grant include the following: the project must be a collaboration, the business must be able to exploit the research results, and the small business and the researcher must not have worked together in the past.

2. Alberta Energy Research Institute (AERI). Looking for a way to finance a research proposal or innovative idea in the fields of oil sands and heavy oil, oil and gas, electricity, renewable and alternative energy or clean coal? The Alberta Energy Research Institute supports such projects through three available programmes:

  • Industry Research Program – available to all companies researching in the areas of AERI mandate and strategic priorities of the Alberta’s Climate Change Action Plan and/ or Alberta Energy Innovation Plan.
  • Innovation Assistance Program — value: up to $50 000 for companies developing innovative products that are aiming to support the practices or technology of Alberta’s energy industry.
  • University Research Program — this particular programme is designed to support environmental and energy research. However, it is currently only open to researchers in Alberta universities.

Wage Subsidies Grants for Small Businesses

wage - grants for small businesses

Penn State / Flickr / Attribution-NonCommercial 2.0 Generic (CC BY-NC 2.0)

The following grants are a really good way to engage youth or your current employees and get the most out of such projects. In addition, these grants could be implemented within your marketing strategy for maximum effect.

1. Career Focus Career Focus is a grant for small businesses that finances activities designed to reach the youth and help them make more informed career decisions. Furthermore, the financed project should develop skills and benefit the involved young participants by providing them with work experience. The program aims to facilitate youth transition into the labor market.

Career Focus aims to increase the number of people involved in different markets by providing them with experience and information. The programme is a part of Youth Employment Strategy. Why is this grant good for your small business? Not only are you receiving help from a fast-learning group of people, but the image benefits for your company are immeasurable.

2. High Demand Youth Internship Program Is your business operating in a high-demand sector? Do you want to hire a post-secondary graduate as an intern? This grant for small businesses could help you do so! The criteria for this grant are a little more specific than the ones described above: if your business has at least 5 full-time employees, has been operating in a commercial space for at least 2 years, and has $2 million liability insurance, then waste no time and apply.

Other Financing Options

Unfortunately, sometimes you may struggle to find a small businesses grant that suits your financial needs. In such cases, taking out a loan might be your best option. A number of companies provide small business loans intended to suit the needs of companies like yours. Zillidy’s Small Business Loans are tied to collateral such as jewellery and precious metals, so aren’t affected by your credit score and don’t affect it, either.

Another big advantage is that you don’t have to complete massive application forms and the process is relatively expedient. Furthermore, you can invest the loan more freely, using the capital as you see fit. Which grants do you think would work best for your small business? Let us know in the comment section below.

Asset-Based Loans for Retailers: Top 5 Reasons to Use One!

As a retailer, you probably face a growing number of financial challenges every day, but how can you cope with them? Asset-based loans are the solution that can help you sustain your small or mid-sized business.

There’s comfort in requesting money from asset-based lenders because you can tie the loans to inventory or personal possessions. An asset-based loan will allow you to secure your funds quickly, without having to go through preparing endless application documents.

What can you use an asset-based loan for? Here are the top 5 reasons you might want to consider taking one out:

 
 

5 reasons to use asset-based loans

Chris Potter / Flickr / Attribution 2.0 Generic (CC BY 2.0)

#1  Business expansion

Is your business growing, but you can’t afford to expand and satisfy rising demand? This is one of the reasons small and mid-sized businesses take out an asset-based loan. If your company is rapidly growing, it needs capital investment in order to sustain that growth and ride the wave of demand. Otherwise, you risk a big loss if you let it simply die away prematurely.

Expansion - Asset-based loan

Chris Potter / Flickr / Attribution 2.0 Generic (CC BY 2.0)

Many retailers are taking the route of expansion in Canada, inspired by new consumer trends that are already impacting the industry in a positive way. From taking on social media to expanding locally, there is a number of moves to be made if you want to grow your business.

If you have great ideas, but not enough funds to put them into action, don’t despair. With an asset-based loan you don’t have to limit yourself or your business. This extremely attractive loan option provides you with an easy and secure way to finance your creative endeavors.

#2 Logistics expenses

Due to the financial crisis that is unfortunately far from over, many logistics expenses have been on the rise these past couple of years. It’s no doubt extremely hard to plan company budgets, especially with unexpected political and social factors, impacting the logistics expenses of your small or mid-sized retail business.

The most recent change to seriously affect small businesses was the hike in gas prices. Fuel cost skyrocketed to over 142 cents per liter in the beginning of July. This is an all-time high not only outraging customers, but also threatening small and mid-sized retailers. Logistics expenses are thus on a rise that companies did not forecast or expect.

An asset-based loan can come in handy at a time like this, to help retailers, such as yourself, sustain their business and cover the rising cost of much-needed logistics services.

#3 Seasonal spikes

Right now is the best possible time to evaluate your retail business’s financing options for the upcoming seasonal spikes. You want to be ready when the wave of demand hits, so make sure you’re planning accordingly. Indeed, many small and mid-sized businesses across Canada have been using asset-based loans to jump on this opportunity. Maybe it’s time you consider doing the same too.

Seasonal Spikes - Asset-based loan

Chris Potter / Flickr / Attribution 2.0 Generic (CC BY 2.0)

It’s not unusual for seasonal spike revenue to make up a large part of retailers’ yearly profit. But that’s why it is so important that your business is prepared to take full advantage of the spike when it arrives.

The more revenue you generate during a spike, the more you can, then, invest on expansion or marketing campaigns, and sustaining unexpected expenses. How do you finance a seasonal spike? An asset-based loan can help you generate the revenue you expect from such spikes. Which in turn, will strengthen your business and help you pursue future plans.

# 4 Implement innovative ideas

Does your retail company have a fresh idea about how to grow sales? Would you like to launch a new product, but there’s not enough capital to finance it? As a retailer, you might want to consider using an asset-based loan from companies like Zillidy, to finance the implementation of innovative ideas or launching new products.

For instance, you can use an asset-based loan to fuel an innovative idea that just might hit it off. Take CardSwap.ca, for instance. They’ve taken the risk of launching a new service that allows you to receive up to 92% of the value of long-forgotten gift cards or sell ones you were gifted, but don’t want to use, and it has been wildly successful. There are numerous examples of companies that have decided to invest in great new ideas and now thrive from their outcomes.

An asset-based loan can enable you turn your ground-breaking ideas into reality. This may not only change the way people look at your brand, but can also help you reap the other financial and image benefits from starting an innovation .

#5 Debt cover

Cover a debt by getting into, technically, another one? It might sound like a crazy idea, but it’s common practice. Especially when many retailers are pushed against the wall to quickly repay or cover a variety of payments. The businesses that manage to get loans from banks are usually the ones that may suffer pressure to quickly cover a debt or an urgent credit card debt payment.

Debt cover - Asset-based loan

Chris Potter / Flickr / Attribution 2.0 Generic (CC BY 2.0)

Using asset-based lending for debt consolidation can help you sustain your business for a long period of time. You’ll be able to pay off your debt in time and avoid late fees and further hassles. The loan might solve an issue temporarily or simply give you the time you need to secure enough capital to repay all the business’s debt.

Do you think an asset-based loan would help your retail business? Share your thoughts in the comment section below.

Small Business Loans: The 4 Cs of Lending You Need to Know About!

Looking for a way to make that start-up business in Canada something people are going to buzz over? We know how hard it is to expand your business or start one during the current financial state of the economy. Each expansion or start-up needs solid capital in order to take off.

If you don’t already have personal savings in order to finance your endeavor, then you have the following two options — government funding or commercial business loans. Since there are very few grants available, it’s important that all small business owners, like yourself, understand commercial loans very well.

When it comes to loans of any type, there are four major points to pay attention to in order to get an approval. These are Cash Flow, Collateral, Commitment, and Character. They’re known as the 4 Cs of Credit, and they’re used by potential lenders to evaluate loan applications.

Business Loans

Simon Cunningham / Flickr / Attribution 2.0 Generic (CC BY 2.0)

Cash Flow or Capacity

This first “C” has a huge impact on the outcome decision. What lenders understand by Cash Flow or Capacity is a business’ ability to generate enough income in order to repay the loan it has taken out.

How do the lending institutions calculate your capacity? One of the things you need to submit when preparing an application for a loan is a “cash flow forecast” that is usually a part of your business plan. This cash flow forecast is a projection of your expected profit based on your previous track record. A business that can show a positive cash flow – i.e whose income exceeds their expenses — has a higher chance of receiving a loan.

What if you’re a new business and only have a forecast that is not based on any past track record? In such cases, you might want to exclude bank loans from your list of possible lenders. Banks are institutions that generally like extra reassurance, even when it comes down to short-term loans.

However, there are good news! A number of companies that provide similar small business loans. Asset-based lenders, like us here at Zillidy, don’t look at a cash flow / capacity when evaluating short-term business loan requests. Instead, we provide easy and quick short term loans against assets such as luxury jewellery, high-end watches, and precious metals as a collateral.

Good news - Business loans!

Steve Wilson / Flickr / Attribution 2.0 Generic (CC BY 2.0)

Collateral

What lenders mean by collateral is the value of cash and assets that the business owner pledges in order to secure the loan. It’s used as assurance to the lending company or bank that you will repay the loan. Common assets include personal possessions such as money, cars, houses, etc.

Having such personal assets as collateral at risk motivates the business owner to push harder to keep the business going and eventually repay the loan. It’s a win-win for both lender and loan taker.

Capital

The third “C” that loaners take into consideration when making a loan decision is Capital. It refers to the amount of cash you are going to invest in your business aside from the loan. Nobody starts or expands a business without expecting to invest anything, right?

Collateral - Business loans

J R / Flickr / Attribution 2.0 Generic (CC BY 2.0)

To put a fair share into the business yourself is not only expected of you, it’s a must in order to receive a bank loan. Capital assets are not just cash – they might include equipment inventory such as machines or other items purchased especially for your business.

Banks expect the business owner to contribute with cash. If however, you are in a situation where you do not have much capital, you might want to consider small business loans from alternative companies.

Character

Character is the loan taker’s personal credit score and their history with financial institutions. Your character is calculated from your history of borrowing and repaying loans, credit cards, etc. Your credit score plays a vital role in such calculation.

Credit Score - Business Loans

Simon Cunningham / Flickr / Attribution 2.0 Generic (CC BY 2.0)

Late payments or any type of debt — current and/or already repaid ones, among other financial blunders, can affect your credit score negatively. If your credit score is not healthy, your chances of receiving a loan dramatically decrease. That’s why if you don’t have a stellar credit score, or if you want to avoid possibly damaging your currently good standing, asset-based lenders are a great alternative.

We hope this introduction to commercial loans has helped you better understand your options. If you’re looking for a small business loan, but still have any concerns or questions, feel free to ask in the comment section below.

Gas Prices Skyrocket! Will Small Business Survive?

142.9—This is the number that has been causing public uproar all over Canada for the past few weeks. 142.9 is how many cents Canadian drivers must part with in exchange for a liter of gas, which is an all-time high.

Petroleum analysts at En-Pro International have stated that prices are expected to remain high, at least for the near future. Roger McKnight, a senior petroleum analyst at En-Pro, does not exclude the possibility of further increases. He speculates that the dramatic $14.3 a barrel jump in crude oil prices since last year is not due to oil shortages or increased demand, but the civil unrest in Iraq. The Middle Eastern country is the second-highest exporter of crude oil in the Organization of the Petroleum Exporting Countries (OPEC). It is where Canada is expecting to get 60% of its oil for the next several years.

And while the financial sector is being cautious due to the tension in Iraq, small business is suffering exponentially. The high gas prices have affected some sectors more than others.

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Gas prices all over Canada hit an all-time high this week

Photo credit: industriarts / Foter / Creative Commons Attribution-NoDerivs 2.0 Generic (CC BY-ND 2.0) 

 

The Retail Sector

A large number of family-owned retail businesses and local shops are already feeling the consequences of the higher gas prices. Retailers say that this economic phenomenon is diminishing their profitability in more ways than one, since clients are also left with a smaller income to spend. According to a survey conducted by the Small Businesses and Entrepreneurship Council, about 74% of small business owners report that they’re experiencing a negative impact on their business. 47% of them say that because they need to patch up their limited budget after having to spend more than planned on gas, they are prevented from hiring new staff. Moreover, with the higher gas prices, shoppers tend to make fewer trips to the store as they are forced to spend less money. This makes even industry giants, such as Walmart, experience a drop in their revenue, since they target a lower-income demographic, which is the one most severely affected right now.

The Delivery Sector

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38% of the small business owners fear of closing down due to high gas prices

Photo credit: futureatlas.com / Foter / Creative Commons Attribution 2.0 Generic (CC BY 2.0)

Today’s gas prices are especially hard on those who rely on commercial vehicles as the driving force of their business. Plumbing companies, flower deliveries, catering companies and local delivery companies around Canada have been working on a budget tighter than ever before. The majority of them have been forced to raise prices to minimize their losses. According to the Small Businesses and Entrepreneurship Council survey, 26% of small business owners have had to let go of employees or cut their hours. Many believe that if gas prices remain this high or increase further still, their businesses might not survive.

How to Protect Your Business

If your business is already feeling the negative impact of these record-high gas prices, it might be a good idea to consider a Zillidy short-term loan. Zillidy finances businesses by giving out loans based on the value of personal assets given as collateral, rather than your credit score. The company operates like your own personal private banker, only charging interest on its loans, hence, loaning the most money on an asset it possibly can. Zillidy specializes in asset based lending to small and medium businesses in Canada and the USA. They might be just what you need to increase your liquidity and give your company that little boost to get it back on the right track.  

5 Top Aboriginal Entrepreneurs Conferences and Tradeshows in 2014

 

In Canada, aboriginal entrepreneur conferences are having a bigger impact on the local and national economies each year. As more aboriginal people across the country find funding through small business loans, educational support, and business mentorships, they are starting to represent a larger portion of the entrepreneurial market; businessmen and businesswomen who shape the major businesses and industries of our time. National recognition of aboriginal Canadians has increased because of many factors, including National Aboriginal Day in Canada on June 21, and thanks to supportive educational and business programs, native Canadians are becoming a driving force in their communities and the wider country. 
 
Many aboriginal entrepreneurs meet one another at national and business conferences to share ideas, exchange business information, and learn about the up-and-coming elements in their industries. For new aboriginal entrepreneurs and business owners in Canada, the benefits of attending such conferences include making important business contacts, keeping up-to-date on the state of the industry, and finding wider markets for existing products and services. The following list is comprised of the most popular and industry changing aboriginal business conferences and tradeshows of 2014.
 
Aboriginal-Conferences-in-Canada-2014
 
 

CCAB Special Information Sessions
July 22, 2014

 
Hosted by the Canadian Council for Aboriginal Business – or CCAB – the Special Information Sessions in Winnipeg are just one of the Aboriginal-focused events held each year by the Council. This particular session is a short, hour-long conference in which the hosts intend to explain their plans to increase the number of business relations and transactions between Aboriginal and non-Aboriginal businesses and entrepreneurs.
 

CCAB 12th Annual Vancouver Gala
September 25, 2014

Aboriginal-Gala-in-Vancouver 
 
The annual Vancouver Gala is focused on celebrating the success of individuals within the Progressive Aboriginal Relations program. Awards will be handed out to participants who have worked to strengthen their own business networks and become trusted members of aboriginal and non-aboriginal communities. Opportunities also exist to learn more about these individuals, and to meet and greet other industry leaders.
 

CCAB Aboriginal Entrepreneurs Conference and Trade Show (AECTS)
October 8-10, 2014

Hilton-Gatineau-(Casino-du-Lac-Leamy)

The CCAB Aboriginal ECTS takes the classic trade show and puts the focus on helping aboriginal members of the business community — including first-nation citizens and Metis — grow and prosper. Both aboriginal and non-aboriginal businesspeople and entrepreneurs will attend the conference with the goal of connecting with one another, promoting products and services, and growing their networks.
 

Aboriginal Business Luncheon: Fredericton 
October 23, 2014 

 Aboriginal-Business-Luncheon-Fredericton
 
The Aboriginal Business Luncheon is a vital meeting for business leaders and entrepreneurs in Fredericton and surrounding areas to get together and discuss pressing issues. Pipelines, TransCanada, and Energy East developments are expected to be at the top of the agenda. The dialogue between these large businesses and the local networks who are concerned about safe and sustainable development — as well as strong economic growth — will likely affect how businesses move forward in the following year.
 

CCAB Aboriginal Business Hot Topic Series: Northern Peoples, Driving the Northern Economy
November 20, 2014

 Aboriginal-Business-Series-Northern-People
 
The CCAB Northern Peoples conference is scheduled to focus primarily on the relationships that Canada’s northern populations — such as the Inuit — have with their governments, their businesses, and other driving forces within their communities. Organizers want to discover the distinct features of a business venture that appeals to the Inuit, and learn how to work within that framework now and in the future. Attendees will learn more about the driving forces of local and national economies, and better understand their own part in the future of each.
 
Aboriginal business owners, community leaders, and entrepreneurs have a lot to gain from attendance at any one of these events in 2014. These are the times and places to make business contacts, build your network, and learn more about subsidies for education and easy-to-handle grants.
 
 

How Can Canadians Check Their Credit Score?

Keeping your financial stability should be one of your primary purposes. You can never know when will you need a loan, after all there are always unexpected expenses – you might suddenly have to buy new equipment for your business or renew supplies, for example. That is why you should keep track of your credit file.  Almost every adult Canadian has a credit file and more than 22 million Canadians don’t know what’s inside those files.

Have you ever been denied credit and you don’t know why? Are there any mistakes in your credit file? Such questions come up sooner or later and it is a good idea do a simple credit check once in a while. You might even be a victim of stolen identity or there might be errors in your statement that prevent you from receiving a loan. It is always good to be informed and, in addition, it is actually free to check.

 

credit

 What’s in a credit report?

After you have checked your credit file, you might be surprised how much personal financial data it contains. You’ll be able to see whether you have paid your bills on time, a list of every loan you have acquired, your credit limits on each of your accounts and a list of your authorized credit grantors.

Each account is represented and evaluated in three ways – the letter “R” stands for the revolving debt of your account (means you have “revolving” credit, where you make regular payments in varying amounts depending on the balance). The letter “I” stands for installment account (means you were given credit on an installment basis, such as for a car loan, where you borrow money once and repay it in fixed amounts). And, finally, the letter “O” which stands for open credit (means you have open credit such as a line of credit, where you borrow money, as needed, up to a certain limit).

 

Credit Report

The measurement system of the state of your credit report also includes numbers – from 0 (too new to rate) to 9 (too bad or placed for collection of bankruptcy). The lender will check the combination between the numbers and the letters, for example: R0 – Too new to rate; R9: Bad debt; placed for collection; moved without giving a new address or bankruptcy. So if you want to have positive report you must try to balance these measurements and be somewhere between R5 and R8.

Keep in mind that every bank or company that is considering of granting you credit will always check both the letters and the numbers. After a thorough investigation (your credit report gathers data for the past six years) and an interview with you, they might be inclined to grant you the credit. If you’ve never checked your credit score, here’s an example so you know what one looks like.

What about my credit score?

Your credit score is not part of your credit report. It is a three-digit number, calculated with a mathematical formula that transforms your credit report into a rating that helps lenders evaluate your ability to repay loans.

The score ranges from 300 to 900. The higher the number, the better. So, if you are applying for a loan or a mortgage and your credit score is between 750 and 800, it is quite likely that you will be granted what you have applied for. Very few people have a credit score above 800.

The minimum credit score you have to have in order to acquire a loan varies among lenders. Some of them may accept scores as low as 650, but even then, there will be many additional clauses attached to your loan. So if you are about the ask for a loan or a new credit card first check your credit score and then see what your options are – whether you can fix or is it good enough.

Credit Score

 

Many of you might want to know the credit score mathematical formula, but for now the exact formula is kept secret. There are some people who have tried to figure it out but ended up with bad credit score because of wrong calculations and their loans were denied. If you want to know your credit score, you simply have to ask for it.

How can I get my credit report and my credit score?

You can ask for a free copy of your credit by mail. There are two national credit bureaus in Canada – Equifax Canada and TransUnion. You are advised to check with both bureaus, in order to spot any mistakes or discrepancies.

To get these official copies of your credit report, you have to send in two pieces of identification and some background information on why you want to acquire it. The estimated time of delivery is between two to three weeks, and depends on your location and mail services.

Don’t hesitate to request your credit report and find out your credit score. These two things combined are very important evidence of your financial stability. We encourage you to check them at least once a year, but keep in mind that it’s not a bad idea to check them even two or three times annually. But as long as you’ve been paying your bills on time and avoided spending money recklessly, you’ll likely have a great credit standing.

Is your credit score important for all loans?

Alternatively, there are also lenders which are not interested in your credit score. A personal asset lender such as Zillidy can offer you a business loan against collateral, without any background checks of your credit score or financial history.

This means that you can get your loan as soon as your asset has been appraised, which is usually within a few days of us receiving it. If you have to act quick, a loan from a personal asset lender is especially suitable.

Business Loan in Ontario: what options do businesses have?

Whether you are running an established small business or just getting yours off the ground, it’s imperative that you be able to receive a business loan. Ontario businesses are no exception; fortunately, there are many options available to the small business owner in this province. The most popular option is to apply for a bank loan; government grants, subsidies and loans are a few other great options that many people tend to forget or ignore.

The reasons for acquiring a small business loan are numerous: the funds may cover necessary start-up equipment, storage or rental space, certifications and marketing plans. Whatever phase of business you are in, large amounts of money are often necessary to keep the business strong or to expand into further markets. If you are a small business owner in Ontario, there are six major sources of business funding that you should familiarize yourself with:

Happy Canada Day!

#1. Grants Ontario

Ontario Grants

The Ontario government is dedicated to boosting the number of lending alternatives for local businesses and enterprises. These loans, smaller in size than traditional bank loans, make it possible for small business owners to establish and grow their companies in Ontario without carrying a large amount of debt or making existing debts exponentially larger.

Various ministries, directorates and even corporations offer over 20 such loans, covering cultural, social and other venues. A notable example is the ‘Microlending For Women In Ontario’ program, which is currently in its final phase and will probably offer new loans as of next year.

#2. Canada Small Business Financing Program

Canada Small Business Financing Program

The Canada Small Business Financing Program is a federal program that applies to Ontarians and members of other Canadian provinces as well. If you need a loan for small business purposes, you are free to apply so long as your company makes less than $5 million in annual revenues, it is a for-profit venture and is not a charitable or religious organization.

And as of April 1, the CSBFP has undergone changes intended to decrease the bureaucratic clutter and make banks more willing to extend loans under the program. Changes also introduced more securities and rights to lenders as well as removed certain limits from borrowers, such as the limit for financing.

#3. Leadership Grants

Leadership Grants

Leadership Grants are available to Canadians who demonstrate sound skills and business plans with their applications. Grants are intended to fund equipment, education, advice, marketing and any other necessary part of an entrepreneurial plan without the recipient needing to pay back the money. They also seek to support currently employed or unemployed persons who wish to venture out into the world of being a business owner.

The amount of the loan that The Leadership Grants Organization can cover is up to $100,000.

#4. Bank Business Loans & Business Credit Accounts

This is the most common form of business lending, since the options are so widespread. In Ontario you can apply with TD Canada Trust, HSBC, Royal Bank and other major financial institutions for large business loans.

Large banks not only offer traditional business loans, but credit accounts crafted specifically for small business owners. These include both credit cards and lines of credit, which are connected to an existing bank account. Lines of credit generally reach about $5000 and are more flexible than a business loan; Ontario business owners can use such accounts over the long term while making regular payments on the capital.

#5. Asset-Based Loans

Zillidy

Loans based on assets, such as those provided by Zillidy, are given to individuals and small businesses who offer up collateral in exchange for financial funds. Unlike other institutions, Zillidy is not concerned with an applicant’s credit score or financial history.

Zillidy’s loans are ideal for small business owners who have equity in assets and wish to capitalize on those, without at the same time risking to lose their precious belongings. Loans can be repaid at any time and there are no application or renewal fees in the process of obtaining a loan. The many success stories on Zillidy’s page testify for this.

Conclusion

Each type of loan or grant comes with its own specifications and guarantees; it is important that you as a business owner carefully consider each option and how it will benefit you in both the short and long term. Zillidy is a Canadian industry leader when it comes to asset loans, and they are available in person or through insured mail to appraise any valuables you are considering using as collateral.

Consult These 5 Small Business Resources for a Prosperous Enterprise

Finding funds to back up and develop your idea is essential, of course. If you’ve decided to go into the retail business, there are a number of small business loans to help you start. So, whatever line of business you wish to pursue, keep in mind that drafting a solid business plan is a must.

Ultimately, it’s not enough to have a great idea in order to start a small business that’s destined to succeed. So many unique ideas die out because of bad planning, or bad calculations of available funds. Too often, entrepreneurs fail simply because of insufficient knowledge of how things must be done to ensure progress.

Often, if you’re too busy worrying about how to cover the basics of your budding small business, then you may overlook important details that play a crucial role in the long run. Such details include accounting, steady online marketing or government requirements.


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Along with the funding, there are other aspects of the business to be considered, and, luckily, Canada offers valuable free small business resources to aid your efforts along the way.

Let’s examine some of these organizations, and in what way you can benefit from the services or business advice they have to offer.

#1. CanadaOne

This is a great small business resource, because it can help people start and grow their business in Canada. The help comes in a form of a library of more than 900 articles, providing information regarding digital marketing or using technology to the fullest in order to boost your online presence. You can find tips about how to network and find other “verified Canadian businesses” that can be of use to you. Learn about what goes into the perfect press release, and find out what marketing and PR techniques can help you increase your sales.

On this site, you can find answers to many questions that may arise at the beginning of your journey. They may be connected to what works and what doesn’t in a contract, advertising methods and customer service. There is also a nice tutorial about how to use LinkedIn as a customer relationship management as well as other questions related to taxes and financing.

One of the greatest features of the site is the Canadian Business Events Calendar where you can check out all the upcoming business events, seminars or conferences across the country. Take a look!

#2. Small Business BC

Among the great small business resources, this site offers some of the most necessary tools for starting and growing businesses. Get tips about business planning, how to register a company name, and even about good business solutions regarding importing and exporting.

Check out some of the seminars being offered for free or a small fee. Usually, the discussion topics revolve around human resources, social media, tax, business contracts, even what steps to take to exit a business or a partnership.

#3. Canada Revenue Agency


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Whatever you do, sooner or later you’ll have to start paying taxes. This governmental siteis quite helpful in terms of making clear what your obligations and entitlements are as a small business owner. Here you can find definitions of all the different business structures, including self-employment, sole proprietorship and partnership. Right from the very start, it’s important to be clear about the kind of structure your business will adopt, and which taxes you’ll be required to pay.

Here you can also find useful tips on how to prepare and handle an audit, payroll deductions and more. In addition, you can find different forms to download as well as guides and booklets to consult in case tax questions arise, and they always do.

#4. BizPal

BizPal a great free online source of information on permits and licenses. It started out in 2005, and in essence, it is a partnership combining federal, provincial, territorial, and municipal levels of government.
Business owners can find which permit or license is required for their business. The site also provides links to more information about how to apply.

#5. National Research Council – Industrial Research Assistance Program

If your startup will deal with the development and commercialization of technologies, this is a good source of information. It provides support to small and medium-sized companies, by offering advisory services. Consult them especially if you’re wondering where to find funding for innovative research and development projects.

In addition, through this Program, business owners have access to an extensive network of individuals and organizations that can advise on financing, research, marketing, problem solving, management skills, development and legal matters.

Get Ready


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Hold on to the old saying that one doesn’t need luck if one is well prepared. So do your homework beforehand, finance your idea with a number of small business loans available to you and get started. Don’t hesitate to use the abundance of small business resources, because their sole job is to help you kickstart your idea and grow your company. Remember that Canada wants you to succeed!

5 Stepping Stones Toward Rebuilding Your Credit Score

As an entrepreneur, you know how important your credit score is when you need loans to put fresh money into your business. So it can be quite stressful to obtain a copy of your credit report and find out that your overall credit rating isn’t that great. And for a small business owner, it’s crucial to be able to have access to the financing you need along the way. That said, it’s good to know how to improve your credit score in the long run.

It’s a well-known fact that a credit score can range from 300 to 850 points. If it’s above 650, you’d have a good chance of getting a regular loan, but if it’s lower than that, qualifying for a new loan can be a challenge. When applying for a small business loan, most lenders take your credit history under consideration before making lending decisions.

Keep in mind that based on your province and reason for going into debt, credit bureaus and agencies store the negative information regarding your credit score for up to seven years. However, if your credit score has been compromised, rest assured that there are ways in which you can improve it.
There is no easy fix, but taking some small steps today can guarantee you peace of mind and actual results later on.


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While you’re working on rebuilding your credit score, we at Zillidy can certainly lend a hand in your efforts to become debt-free. Even if you have a bad credit, we can help you achieve your immediate business goals with a short-term collateral loan. It’s a reliable and handy option if you are really pressed for cash.

Now, let’s take a look at the first stepping stones for rebuilding your credit score:

#1. Try to bring down your credit card or line of credit balances.

If you’ve maxed out your credit cards or have other high balance debts, find a way to start paying back what you owe. Bring the balance down to below 50% of your credit limit if possible.

Overall, if you don’t have late payments or any other negative factors, your credit score should start improving within a month. Just make sure you keep your balances down below this line.

#2. Do you have collection agencies breathing in your neck?

Be aware that if you do, collections also affect your credit score negatively. Normally, under the public section of a credit report, there appear unpaid parking tickets, cell phone bills, utility bills, cable bills and other small debts that are not part of a credit account.

Again, set aside some money to pay off your debts. Then request that creditors remove their collection notations from your credit report to clean it up.

#3. Avoid late payments.

Do your best to catch up if you’ve missed any previous payments. The entities to which you owe money will report on your credit report that you have overdue payments. This is a negative trend that will immediately send a message to your potential lenders that you are not a reliable payer.

If you need time to work out your financial issues, don’t turn a blind eye and miss your payments. Call your creditors and check whether they’d be willing to work with you, so you can get the situation straightened out. If they are not cooperative, turn to a non-profit credit counseling service for help. Such organizations may offer debt repayment programs through which you can make affordable monthly payments. When the program ends, you’ll have the chance to re-establish your credit rating more quickly than with any other credit-fixing option out there.

According to Equifax, one of Canada’s major credit report agencies, people who complete such debt repayment programs tend to have higher credit scores than most Canadians.

#4. Is bankruptcy an option for fixing your credit?

Well, a straight answer to this question is not so easy. By definition, bankruptcy should be considered only after all other possible options have been exhausted. If you find yourself in a very difficult financial situation, the first thing to do is turn to a knowledgeable credit counsellor for advice. Together you can work out a payment plan for repaying your creditors.


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Bear in mind, however, that even to declare bankruptcy, you’d have to cover the $1,800 bankruptcy fee. Depending on each individual situation, sometimes people cannot qualify for bankruptcy if, despite their debts, they earn too much money or have too many valuable assets. Then, the creditors will do everything possible to get their money back, like take you to court and seek judgement against you.

Another factor to consider is that while yes, bankruptcy is a way to slowly rebuild your credit, at the same time it negatively impacts your credit record for 8 to 10 years. So, it may seem like an easy way out, but it’s not. Again, use it only as a last resort.

#5. Re-establish your credit.

If you’ve been wondering how to improve your credit score, this may help quicker than anything else.

The best thing to do is have an active credit account while you’re working on paying off your debts or have already repaid them. You need to have active credit, because the system is set up in such a way that even if you’ve paid off all of your debts, you’ll have no credit score or a negative one, if no information at all is reported to your credit bureau. So get a new credit card, line of credit or overdraft account, but this time be careful and maintain it responsibly. This way you can start re-building your positive credit score from scratch.


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Oftentimes, because of your previous negative record, you’d have to apply for a secured credit card or secured overdraft account. This means that the financial institution requires you to make a deposit against the card’s credit limit. The credit limit may be the same as your deposit or a percentage of it. So if you don’t make timely payments, your account will be closed and paid off with that money. Check with your bank, credit union or some major credit card companies for more details if you want to further explore this option.

Conclusion

Even if you’ve damaged your credit score, follow the aforementioned suggestions to re-establish your credit and avoid harm to your business in the process. Start making small steps toward paying off your debts, so you can have a clean slate and access to fresh money when you need it.

And don’t forget that Zillidy can be the source of such money through our short-term collateral loan. All you need is a valuable asset – anything from precious metals like gold, silver or platinum, high end jewelry, diamonds or a luxury watch. The higher the value, the more money we can lend you in exchange, so a comfortable amount sufficient to cover some or all of your debts is within reach.

Give us a call at 1-877-661-5711 and let us know how we can help. Don’t delay!