2010 – 2022 BDC Legislative Review Brief

Prepared by: Canadian Women’s Chamber of Commerce

2010 – 2022 BDC Legislative Review Brief

Prepared by: Canadian Women’s Chamber of Commerce

March 23, 2023, e-Townhall Event

On March 23, 2023, CanWCC held a virtual Townhall event to raise awareness of the BDC Legislative Review and collect feedback to inform this brief. The 90-minute event, held over Zoom, was open to the CanWCC community and members. The event was promoted in CanWCC newsletters and on social media.

Fifty-one individuals registered for the event, and 36 attended. We had participants from British Columbia, Alberta, Manitoba, Ontario, New Brunswick and Newfoundland.

Summary of Feedback from the e-Townhall Event

  • Women-identified business owners that had received loans from the BDC reported varied levels of satisfaction with their experience. The overall feeling was negative, although one attendee reported a positive experience, which she directly attributed to the BDC representative she worked with.
  • One person expressed frustration (as they were misled to believe) that to secure a BDC loan, they were required to pay for BDC advisory services – and that the advisory services they received were unhelpful and “a waste of time and energy.”
  • Multiple participants noted that the interest rate charged on loans provided by the BDC is too high. Both the interest rate and the cost of advisory services were noted as being cost-prohibitive for many small business owners, particularly woman-identified small business owners.
  • BDC is seen as a “gatekeeper” in the small business ecosystem.  BDC is the provider of debt financing for many small businesses, especially those owned by women and diverse people who are turned away from regular financial institutions. There is a perception that because BDC is an agent of the Federal Government (via public policy),  BDC makes riskier loans than traditional financial institutions. That creates an environment where those advisors and financial institutions direct business owners to BDC, and then consider their job done. However, BDC is not a bank for all entrepreneurs and this is the major problem because there is a funding gap for those that do not fit their objectives and funding philosophy.
    • Women-owned small businesses need grant-based funding. Many women business owners are unable or unwilling to take on additional debt, particularly following the pandemic’s negative personal and business financial impacts.
  • Connecting business owners and programs across provinces, territories, and regions is necessary.

Recommendations from CanWCC Management

  • BDC needs to be more transparent in its reporting and impact. Specifically, it must provide annual disaggregated data on its financing, investing, and advisory services and comparative data from prior years to show impact and improvement over time.
  • As a Crown corporation, BDC (its management and employees) must be open to constructive feedback on service design and delivery.
  • BDC needs to clarify its strategy, goals, objectives, and funding philosophy with respect to partnerships with organizations that serve entrepreneurs.
  • BDC needs to create affordable advisory services and deliver quality content to a diverse audience that is contextually relevant to the recipient based on the stage of their business. 
  • The way that BDC presents itself in its marketing and communications is often at odds with its commercial requirement to be financially self-sustaining. Ultimately, BDC is a bank but portrays itself as an organization that offers services to businesses and business owners at all stages. This leads to confusion and disappointment among entrepreneurs – particularly underserved early-stage business owners. The BDC should be clear and transparent about what services it provides, what businesses are eligible for what services, and the distinction between BDC’s public policy role versus its role as a financial institution.
  • CanWCC recommends that BDC expand its lending to include not-for-profit corporations (e.g. grant financing, working capital loans, etc.) and micro-loans for diverse entrepreneurs. 

About the Canadian Women’s Chamber of Commerce

The Canadian Women’s Chamber of Commerce (CanWCC) is Canada’s only chamber of commerce that advocates for diverse women-identified and non-binary business owners. Launched in 2018, CanWCC is a national not-for-profit organization whose advocacy focuses on pursuing economic equity and centering the principles of equity first in all our work. 

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