Start Up Business Loans in Ontario: Best Options & How to Qualify
Looking for a loan to start a business in Ontario? You’re in the right place!
This guide keeps it simple: who lends to startups, how much you can get, and how to qualify. We also cover the 20 best startup loans for Ontario entrepreneurs. Plus “stacking”: how to combine other types of business funding (grants, subsidies, tax credits and more) to get more money for your startup!
Key Takeaways:
Related Articles for Startup Entrepreneurs
– Ontario Startup Grants: 246 Grants & More for Ontario Startups
– Best Startup Accelerators in Ontario: Our 10 Top Accelerators + What to Look For
– Startup Incubators & Accelerators in Ontario – Directory of Organizations & Programs
– Startup Funding Toronto: Where to Find Investors in Canada’s Tech Hub
What is a Startup Business Loan?
In Ontario a startup business loan can be defined as follows:
A startup loan is money you borrow to launch or grow a new business (typically under two years old), repaid over time with interest, usually with a personal guarantee or pledge of collateral, from lenders like banks, credit unions, government-backed programs, non-profits, or fintechs.
How Startup Loans are Different Than Loans for Established Businesses
Startup loans differ because new businesses don’t have a track record, so lenders rely more on you and put extra restrictions on the money. Here are the main differences from loans for established businesses:
What Types of Startup Loans are Available to Entrepreneurs in Ontario?
There are many types of startup loans in Ontario offered by dozens of organizations. We cover the main ones below:
Government Loans for Ontario Startup Business
These are direct loans from public agencies (federal, provincial, or community development groups). They’re designed to spur local jobs, so terms can be friendlier, amounts smaller to mid-size, and often come with coaching. Good fit for founders with a clear plan but limited collateral.
Government-Guaranteed Loans for Startups
A bank or credit union lends you the money, but the government guarantees part of the risk (e.g., for equipment or leaseholds). You still repay the loan and usually give a personal guarantee, but the guarantee helps you qualify and can improve terms. A prime example is the excellent Canada Small Business Financing Program (CSBFP).
Bank Loans for Startup Businesses
Traditional term loans or small lines of credit in the business’s name. Approval leans on your personal credit, a simple plan and projections, and some security. Best when you can show a solid budget, vendor quotes, and some of your own cash in the deal.
Ontario Credit Union Loans for Startup Businesses
Credit unions are lenders that often make smaller, relationship-based loans. They can be more flexible than big banks on early-stage files and may bundle advice or local networking. Still expect a personal guarantee and a clear use of funds. Two business-friendly credit unions in Ontario are Meridian Credit Union and Alterna Savings.
Online Loans for Startup Businesses
There are online-only lenders (aka “fintechs”) in Canada that offer fast, mostly digital applications with quick decisions. Useful for short-term working capital once you have at least some revenue. Costs are usually higher than banks/credit unions, and terms are shorter, so plan your cash flow carefully. Popular fintechs that lend to Ontario businesses include Merchant Growth and Driven.
Private Business Loans for Ontario Startups
These loans are provided by non-bank lenders (alternative finance companies) offering term loans, equipment financing, or revenue-based options. They move quickly and focus on the asset or future cash flow, but pricing is higher and security/PGs are common.
Audience-Targeted Loans
These are loans tailored to who you are as a founder—e.g., women, youth, newcomers, Indigenous entrepreneurs, veterans. The loans are often paired with mentorship or training and may have easier eligibility or add-on supports.
Industry-Targeted Loans
Industry loans are aimed at what you do—e.g., farming, manufacturing, tech, clean energy, restaurants. Funds are tied to industry needs (equipment, R&D, certifications) and underwriters understand sector risks, which can help borderline files.
Ontario Regional Loans
As the name suggests, regional loans are place-based funding that support specific communities (rural, Northern, or city-based programs). Usually smaller, flexible loans delivered by local organizations that also offer advisory services and referrals to other supports. Major lender for Ontario regions include NOHFC (Northern Ontario Heritage Fund).
Top 12 Ontario Startup Loans
Canada Small Business Financing Program (CSBFP)
The CSBFP is a federal loan-guarantee that helps small businesses get bank/credit-union loans, with combined limits up to $1.15M (up to $1M in term loans plus up to $150k in lines of credit).
BDC Inclusive Entrepreneurship Loan
BDC’s Inclusive loan offers up to $350,000 for businesses at least 51% owned and led by women, Indigenous or Black entrepreneurs, with no application/annual fees and the option to postpone principal payments up to 24 months.
Summer Company
Students can start a summer business with up to $3,000 in grant funding ($1,500 up front and $1,500 on successful completion) plus training and mentorship.
Black Entrepreneurship Loan
BEL offers black entrepreneurs loans ranging from $25,000 to $100,000 and up to $250,000 in partnership with BDC.
Alterna Community Microfinance Loan
Alterna’s microfinance loan is character-based from $5,000–$25,000, typically up to 5 years, with a BDC joint-loan option to reach $50,000.
Access Community Capital Loan Fund
AccessCCF offers character-based microloans up to $15,000 for GTA/Hamilton entrepreneurs and trainees, with attractive business loan rates.
BDC Startup Financing
BDC’s Startup offers up to $150,000 for young businesses (12+ months and generating revenue), with flexible terms and the option to pay interest-only for up to 12 months.
Starter Company Plus
Starter Company Plus provides training, mentorship, and a grant up to $5,000 to start or grow a business through local Small Business Enterprise Centres.
Financing for Business Start Ups & Expansion Program
FNBSEP provides business financing for First Nations entrepreneurs and businesses in Central/Eastern Ontario to start up or expand.
WEOC National Loan Program
WEOC offers loans of up to $50,000 for women-owned businesses, delivered through regional partners with wrap-around support.
Meridian Business Accelerator Loan
Meridian’s Accelerator offers working-capital loans $25,000–$500,000 for Ontario businesses 12+ months old, offered via the BDC Business Accelerator Loan Program.
Community Futures Flexible Financing
Flexible, locally delivered business loans for startups and existing businesses in rural Ontario, often paired with free advisory support.
Government Lenders Supporting Ontario Startups
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Lender |
What They Do
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Sample Startup Loan
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|---|---|---|
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Term loans and working capital specifically for entrepreneurs, including women-led businesses.
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Supports agriculture and agri-food businesses, including farms, food processing companies, and agri-tech startups.
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A national non-profit organization that supports young entrepreneurs (18-39) with loans, business mentorship, and educational resources. | ||
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Offices in 54 Ontario municipalities. They provide business loans, advice, and training
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Offices in 60 rural areas of Ontario. They provide loans, business counselling, and community economic development support.
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What Lenders Look For (Quick 4Cs Checklist)
1. Credit: Clean personal/business credit history, on-time payments, and reasonable utilization
2. Cash-flow: A clear path to repay the loan—monthly projections, margins, and a realistic break-even
3. Collateral: Business assets (and sometimes personal guarantees) to back the loan, especially on larger amounts
4. Character: Your track record, references, industry knowledge, and how prepared you are in meetings (plan, numbers, proof)
How to Qualify for a Startup Loan: X Steps to Take Before You Apply
How (and Where) to Get a Business Loan with Bad Credit
You can still get funded with bad credit in Ontario, but you’ll need to offset the risk:
Start your search where lenders look beyond your personal credit score:
If you’re eligible, check audience-specific programs (e.g., Indigenous, Black, women, youth) and regional funds.
For asset purchases, ask about equipment/vendor financing or a government-guaranteed bank loan (often available through banks/credit unions) where the asset secures the deal.
If you have business revenue, you can also look at online/fintech lenders, invoice factoring/financing, or purchase-order financing—faster to qualify, but read the fine print because costs can be higher.
Common Mistakes to Avoid When Looking for a Small Business Loan
Here are the most common mistakes that startup entrepreneurs make when looking for a startup business loan:
- Vague ask: They can’t state, in one sentence, how much they need, what it buys, when it’s needed, and how it pays for itself.
- Wrong lender/product: They apply to the first place they find instead of matching the need (e.g., equipment, leaseholds, working capital) to the right lender/program.
- Skipping the numbers: They don’t bring a 12–24-month cash-flow forecast, a realistic “slower sales” case, or vendor quotes to back up the budget.
- Weak personal file: They ignore credit cleanup and don’t show their own cash in (often 10–30%), even though most startup loans require a personal guarantee.
- No proof of demand: They offer ideas, not evidence—no pre-orders, signed quotes, LOIs, or contracts to show customers actually exist.
The Secret to More Funding: “Stacking”
Smart entrepreneurs don’t stop at one grant program – they “stack” grants AND other types of free funding (like subsidies, rebates, and tax credits).
And here’s a secret: there are businesses in Ontario that get tens (or hundreds) of thousands of dollars in free money year-after-year by following the stacking technique.
FAQs: Ontario Startup Loans
Ontario Startup Loans: All Current Loan Programs
Below we list a sample of Ontario business loans in our database, many of which fund Ontario startups:
No fixed amount
Loan
The Additional Residential Unit (ARU) Loan offers financial assistance to property owners to help offset the costs of creating new additional residential units.
$5,000,000.00
Loan
The AgriInnovate Program is a program under the Sustainable Canadian Agricultural Partnership (Sustainable CAP).
The program provides repayable contributions to incent targeted commercialization, demonstration and/or adoption of commercial-ready innovative technologies and processes that increase agricultural and agri-food sector competitiveness and sustainability benefits.
No fixed amount
Loan
The Apartment Construction Loan Program provides low-cost financing to support the construction of seniors housing. It also supports conversion of non-residential to seniors housing.
No fixed amount
Loan
The Apartment Construction Loan Program provides low-cost financing to support the construction of standard rental housing. It also supports the conversion of non-residential to standard rental housing.
No fixed amount
Loan
The Apartment Construction Loan Program provides low-cost financing to support the construction of student housing. It also supports the conversion of non-residential to student housing.
No fixed amount
Loan
Businesses looking into acquiring a company, engaging in a merger, or expanding by acquiring a competitor can turn to BDC for Business Purchase or Transfer Financing. Business owners are advised to seek the necessary financing and support from experts. This approach ensures a seamless transaction that benefits both the acquiring business and the one being acquired.
No fixed amount
Loan
BDC provides commercial real estate financing that can be utilized to increase capacity, purchase land and buildings, or cover construction costs for new projects. It also serves to upgrade facilities by supporting the expansion or renovation of existing premises. Additionally, this financing option can complement one’s line of credit by replenishing working capital depleted by real estate costs.
No fixed amount
Loan
BDC offers Equipment Purchase Financing that businesses can use to increase capacity by acquiring production line machinery, hardware, equipment, or specialized items like lab materials. It also serves to improve efficiency by supporting investments in commercial vehicles or modernizing operations. Furthermore, this financing option can complement a company’s line of credit by replenishing working capital depleted by equipment costs.
$350,000
Loan
Helping ambitious business owners from underserved communities get the financing, education and support they need to succeed.
$350,000
Loan
DC has a long history of working with Indigenous entrepreneurs and appreciates your unique histories, cultures and contributions in Canada. We stand in solidarity with you and all Indigenous peoples and are committed to listening, learning and taking action towards Reconciliation.
No fixed amount
Loan
BDC extends financing options for tech companies, providing support for both earlier-stage scale-ups aiming to secure market positions and established businesses in growth mode. Solutions offered by BDC are tailored to safeguard cash flow and assist tech businesses across various stages, accommodating those with a recurring fees revenue model.
$50,000
Loan
BDC is the bank devoted to Canadian entrepreneurs. We provide financing and advisory services to small and medium-sized businesses at every stage of growth. This includes access to the right tools and resources, such as training, networking, partnerships and more.
No fixed amount
Loan
BDC provides Purchase Order Financing as a recommended solution, offering companies the opportunity to enhance their cash flow. This financing option empowers businesses to meet the demands of substantial orders without jeopardizing their day-to-day operations.
$100,000
Loan
BDC’s Small Business Loan is designed to help businesses quickly and easily access the funds they need with flexible terms they can afford
$250,000.00
Loan
Young businesses need the right financing and the right partners to succeed. Our experts provide advice to help guide you as you take your business to the next level and up to $250,000 to get you there.
No fixed amount
Loan
BDC offers a Technology Loan designed to assist businesses in optimizing performance and increasing profitability through strategic investments in technology. Investing in technology is recognized as one of the most effective ways to drive growth, reduce costs, and boost productivity, making this loan an invaluable resource for companies looking to enhance their operational efficiency and overall financial performance.
no fixed amount
Loan
The BDC Wholesale Financing scheme helps financial intermediaries get more funding for their customers in order to fill market gaps and increase the availability of capital for Canadian entrepreneurs.
Through F-PIL, companies can access funding with scalable financial terms for more access to financing and potentially more favourable funding costs. These companies can be more competitive on pricing with SMEs.
no fixed amount
Loan
The BDC Wholesale Financing scheme helps financial intermediaries get more funding for their customers in order to fill market gaps and increase the availability of capital for Canadian entrepreneurs.
Through Syndicated Financing, BDC supports medium-sized and larger businesses by providing senior debt financing in syndicated transactions led by other banks.
No fixed amount
Loan
BDC offers a working capital financing to Canadian-based businesses to maintain their cash flow.
$250,000.00
Loan
The Black Entrepreneurship Loan Fund is a partnership between the Government, Black-led business organizations, and several financial institutions. It will provide loans up to $250,000 to Black business owners and entrepreneurs across the country.
Loans can be used for:
1. Capital investments–equipment, leasehold improvements, property improvement, office equipment.
2. Working capital–inventory, payroll, lease payments, accounts management, rent, overhead costs.
3. Short-term receivable financing (i.e. financing to service a contact).
$1,150,000.00
Loan
The Canada Small Business Financing Program makes it easier for small businesses to obtain loans from financial institutions because the government shares the risk with the lenders.
No fixed amount
Loan
The Charging and Hydrogen Refuelling Infrastructure Initiative (CHRI) aims to reduce transportation sector greenhouse gas emissions by accelerating the private sector’s rollout of large-scale ZEV chargers and hydrogen refuelling stations, helping to spur the market for private investment.
no fixed amount
Loan
The FCC Advancer Loan pulls out all the stops. It’s everything you need: a pre-approved, secured loan that continually re-advances funds as you grow your operation. And you’re in charge. You determine when you want loan funds disbursed to your account.
no fixed amount
Loan
The FCC credit line provides funds to Canadian agriculture businesses to bridge the cash flow gap. It is a revolving, pre-approved loan that provides money for working capital.
No fixed amount
Loan
The Additional Residential Unit (ARU) Forgivable Loans offer financial assistance to property owners to help offset the costs of creating new detached additional residential units.
$4,000,000
Loan
The Downtown and Barton/Kenilworth Housing Opportunities Program (the Program) is
intended to provide financial assistance in the form of a low-interest Loan to promote the
development of multiple dwelling units that will create new housing opportunities and support
robust local commercial district populations that add vibrancy and support demand for local
commercial businesses/services. Activities supported by this program include:
– The creation of at least 10 new dwelling units through the development of a multiple
dwelling on vacant land, surface parking areas or the redevelopment of existing
buildings;
– A building addition containing at least 10 new dwelling units; and/or,
– The conversion of existing non-residential space into housing consisting of at least 10
new dwelling units
No fixed amount
Loan
EDC can provide financing to Canadian exporters to help support their global expansion plans, allowing them to increase their capacity for trade and capitalize their strategic international growth plans. We work to fill the market gaps left by traditional financing lenders.
We provide patient, impactful, non-dilutive financial solutions for Canadian companies, their affiliate, or subsidiary, to scale operations in foreign jurisdictions.
We work on a non-competitive basis, collaborating with you and your lender.
Various financing structures are available, including syndications, clubs, bilateral term loans and guarantees.
Pricing will be market based, or—if appropriate—follow Organisation for Economic Co-operation and Development (OECD) consensus arrangement terms, and commensurate with risk.
No fixed amount
Loan
Structured and Project Finance is designed specifically for limited recourse financing of long-term, capital intensive projects.
$400,000
Loan
The ERASE Commercial District Remediation Loan (ECDRL) Program provides low-interest Loans which are intended to overcome barriers owners may face obtaining traditional financing for costs required to remediate historical environmental contamination on brownfield sites in support of their redevelopment/reuse. Specifically, this Program is intended to work in concert with broader efforts to support the revitalization of strategic commercial districts and corridors, including those programs and initiatives established under the Revitalizing Hamilton’s Commercial Districts Community Improvement Plan.
$50,000
Loan
The Façade Improvement Loan offers financial support for enhancing building exteriors, covering upgrades to windows, doors, brick repairs, painting, lighting, and signage attached to the façade.
No fixed amount
Loan
If you’re looking to transfer farm assets or you’re a young farmer looking to build your farm, the Transition Loan can help make it happen. It allows you to make payments so you can manage your cash flow or build equity quickly – the choice is yours.
no fixed amount
Loan
FCC offers financing for environmental solutions that can help farmers make environmental upgrades to their operation and switch to renewable energy resources.
No fixed amount
Loan
FCC lend money, share knowledge and provide other services to agribusinesses who provide inputs or add value to agriculture. If your business is looking to grow or expand, let’s talk and help you find new opportunities through our networks and financing expertise.
No fixed amount
Loan
FCC lends money, share knowledge and provide other services to support the food industry. From start-ups to mature enterprises, we partner with businesses and entrepreneurs to help you reach your full potential. If your business is looking to grow or expand, let’s talk and help you find new opportunities through our networks and financing expertise.
no fixed amount
Loan
As Canada’s leading agriculture and food lender, FCC is proud to provide on and off-reserve financing and resources to Indigenous entrepreneurs, economic development corporations and First Nations communities.
Building a diverse industry is top priority and an integral part of FCC’s mandate. First Nations, Métis and Inuit have always been involved in agriculture and food and are uniquely positioned to reclaim their food sovereignty and grow successful businesses.
no fixed amount
Loan
FCC Input Financing is the simple and flexible way to free up your cash flow. You have 12 months to purchase fuel, fertilizer and crop protection, and up to 18 months to pay. Input financing is offered through local retailers allowing you to purchase and finance your inputs at the same time.
no fixed amount
Loan
FCC offers financing to producers to build or expand their operations by buying new land or constructing new buildings.
no fixed amount
Loan
FCC and our participating livestock partners across Canada provide flexible and convenient financing tailored to the needs of feeder cattle and breeding livestock producers.
Financing livestock through a participating livestock partner gives you the convenience of one-stop shopping for your livestock purchases and a program designed for cattle producers, by cattle producers.
$150,000.00
Loan
FCC provides financing to agriculture and food industry startups and to agriculture, agribusiness or food and beverage-related business that were established within the past three years.
no fixed amount
Loan
FCC provides financing to women entrepreneurs in agriculture, agribusiness and agri-food to start or grow their business.Through our research and discussions with women in agriculture, we discovered three key needs: increased access to capital to start or grow their business, access to business and competency skill development for themselves and their business, and access to tools, resources, and people to learn from and be inspired.
$2,000,000.00
Loan
FCC provides financing to young entrepreneurs under 40 to start or expand their business. They can purchase shares in, buy, or improve an agricultural or food-related business, and take their dream business to the next level.
$25,000
Loan
The Ontario Creates Film Fund – Development Stream is intended to support development activities that lead to the production of domestic feature film in Ontario. The Film Fund provides support to Ontario producers for all stages of development activities.
$400,000
Loan
The Ontario Creates Film Fund – Production streams (Drama and Documentary) are intended to increase the level of domestic feature film production in Ontario. The Film Fund provides support to Ontario producers for feature film projects in the final stages of production financing. The prime objectives of the fund are to: – increase investment and jobs in Ontario by Ontario-based feature film production companies; – increase the number of high quality, original feature films produced in Ontario by Ontario-based production companies; and – assist in capitalizing Ontario-based feature film production companies.
no fixed amount
Loan
The Dealer Financing Program is when you buy new or used farm equipment and finance through a participating dealer.
no fixed amount
Loan
FinDev Canada offers financing and equity investments to Canadian companies operating in developing countries that demonstrate sustainable social and economic benefits for local communities, with a focus on job creation, women’s economic empowerment and climate change mitigation.
$10,000,000.00
Loan
FedDev Ontario is investing in people, potential, and possibilities. We want to help you grow so you can reach your potential and unlock new possibilities.
No fixed amount
Loan
The Green Bond program will support projects that contribute to positive environmental outcomes while ensuring we continue to support our overarching mandate and commitment to responsible investment.
CICERO Shades of Green rated PSP’s Green Bond Framework Medium Green. Included in the overall shading was an assessment of our governance structure, which received a score of Excellent.
$50,000
Loan
The Hamilton Community Heritage Fund will be the source of funding for this loan program. The purpose of the loan is to act as a catalyst for stimulating the rejuvenation of designated heritage properties within the City of Hamilton.
Acting as a lender, the City provides financial support for the program and ensures that conservation and development activity arising from the program within the City is consistent with sound principles of managing and protecting designated heritage properties.
$2,500,000
Loan
The High-Rise Retrofit Improvement Support Program (Hi-RIS) program makes low-cost financing available for owners of residential apartment buildings built before 1990 of three or more storeys to make improvements that reduce energy and water consumption.
Hi-RIS is made possible through an amendment to the provincial regulation regarding local improvement charges, which are municipal financing tools used to help cover the costs of local infrastructure improvements, such as streetlights or sidewalks. The amendment allows municipalities to advance funding to consenting private property owners to cover the cost of building improvements that improve energy efficiency and water conservation.
No fixed amount
Loan
The ICII is a collaborative financing solution that offers low-cost and long-term loans to Indigenous infrastructure projects and combines public funding and/or private and institutional investment to get more infrastructure built.
Through the ICII, our investment team looks to provide affordable, long-term financing to Indigenous projects that provide a direct benefit to an Indigenous community or communities.
$100,000,000.00
Loan
Through the IEI, our investment team looks to lend to Indigenous communities to provide them with access to capital to purchase equity stakes in infrastructure projects in which the CIB is also investing. Economic returns from these projects can be reinvested in the community, narrowing the economic and infrastructure gap among Indigenous communities.
no fixed amount
Loan
Canada’s regional development agencies (RDAs) are delivering $200 million through the Regional Artificial Intelligence Initiative (RAII) to help bring new AI technologies to market and speed up AI adoption in sectors across the country. Through the RAII, RDAs will support projects that help businesses and organizations turn ideas into real-world solutions for Canadians and compete globally.
no fixed amount
Loan
Canada’s regional development agencies (RDAs) are delivering $200 million through the Regional Artificial Intelligence Initiative (RAII) to help bring new AI technologies to market and speed up AI adoption in sectors across the country. Through RAII, RDAs will support projects that help businesses and organizations turn ideas into real-world solutions for Canadians and compete globally.
no fixed amount
Loan
As part of the Government of Canada’s efforts to develop a National Quantum Strategy (NQS), FedDev Ontario is delivering the Regional Quantum Initiative (RQI) in southern Ontario. Over $23 million is available over six years (2022-27) to help companies advance and commercialize their quantum products and solutions for domestic and global markets.
No fixed amount
Loan
Since its inception in 2012, the Social Impact Fund has unlocked the Foundation’s assets in order to create positive change in the community by providing loans to social enterprises and affordable housing projects.
$450,000
Loan
The Start-up and Office Tenant Attraction (SOTA) Program is intended to provide
low-interest Loans or Forgivable Loans that will facilitate the undertaking of eligible leasehold
improvements to office space by property owners or authorized tenants in order to support the
creation of new office space and improve the marketability and attractiveness of existing office
space. This Program will serve as a tool to reduce office vacancy rates in Downtown Hamilton
and other eligible commercial areas and serve as a means of attracting new and expanding office
uses and businesses to Hamilton.
$200,000
Loan
The Upgrade to Building Code Loan offers financial support for interior improvements to your building, including upgrades to plumbing, electrical systems, HVAC, mechanical systems, roofing, fire protection systems, and other work required to meet Building Code standards.