A grant is money you don't repay; a loan is money you do. Each fits a different situation — and in Canada you can often use both on the same project. Here's how to choose, and how they stack.
Grants don't have to be repaid, but they're competitive, project-specific, and can take months — you apply, compete, and wait. Loans are repayable, but they're faster and more predictable, and government-backed options like the CSBFP make them cheaper and easier to get than a regular bank loan. Most Canadian businesses don't choose one or the other: they use a loan for the capital they need now, layer a grant on an eligible project, and claim tax credits like SR&ED at filing — all on the same investment.
A grant is non-repayable money for a specific purpose, awarded competitively against criteria — it's the cheapest capital there is, but the hardest to get and the slowest. A loan is repayable with interest, but it's available on demand, scales with your needs, and a government-backed loan such as the CSBFP shares the lender's risk so you can borrow up to $1.15M for equipment, property and more. Tax credits (like SR&ED) are a third lever — money back at filing for eligible activity.
The strongest funding plans combine instruments. A common pattern: take a CSBFP loan to buy equipment and cover working capital, apply a grant to the eligible portion of a hiring or R&D project, and claim SR&ED or a provincial tax credit on qualifying work at filing — each from a different pool, on the same investment. The catch is that some programs cap total government assistance per project, so always check stacking rules before you assume you can combine them. CanaGrants matches all three against your profile so you see the full picture, not one program at a time.
A grant is non-repayable, so in that sense it's "free" — but it's not easy. Grants are competitive, tied to a specific purpose, often require matching funds and reporting, and can take months. The effort is the price.
Usually a loan, especially a government-backed one like the CSBFP, where the lender's risk is shared. Grants are awarded competitively against criteria, so approval is less certain and slower.
Often yes — they come from different pools and serve different purposes, and a loan can even fund the matching share a grant requires. Watch for programs that cap total government assistance per project.
Tax credits like SR&ED are a third lever: you claim them at tax-filing time for eligible activity (such as R&D), and they generally stack with both loans and grants on the same work.
Run a free check against your business profile — loans, grants and tax credits, matched in one place.