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How to Get a Small Business Loan in Alberta

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Alberta is a Canadian province like no other. Known for its expansive prairies and stunning mountains as much as its business-friendly environment, Alberta stands apart, especially when it comes to the economy and employment. 

According to federal government statistics, Alberta ranked second in Canada for the largest number of businesses per thousand households, and small businesses accounted for nearly three quarters (74%) of private sector employment in the province in 2019. As a province built through the hard work of the Alberta entrepreneurs, Alberta’s historical legacy shines in these recent statistics, as it’s economic livelihood continues to be carried by small business, creating situations across the province where small business loans are absolutely essential. 

For anyone in search of business loan information in Alberta, including how to give your application the greatest chance of approval, this short guide will give you all the information you need to make an informed decision and prepare your application. 

Business Financing in Alberta

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Across industries all over Alberta, small and medium-sized businesses need reliable, affordable financing to thrive, and the best way to do that is with small business loans. In Alberta, small businesses companies have three categories of options for financing: 

Major Financial Institutions

Colloquially referred to as “the big banks,” these institutions are rarely the best choice for small business loans. Notorious for wrapping up clients in endless red tape, banks simply have so many ways of making money that they don’t make much of an effort to help small businesses. Loyalty is rarely rewarded, and many viable loan applications are rejected because banks prefer to seek higher returns by putting their investment budget to work in other areas. 

Alternative Lenders 

So-called alternative lenders, such as Lendified, have earned this moniker because they provide financing for small and medium-sized enterprises with small business loan terms and conditions that help ensure the long-term success of all parties, delivering a truly viable lending alternative to the big banks. 

Through easy online applications, Lendified can approve small business loan applications of up to $150,000 in minutes, and deliver better rates than merchant cash advances or other alternative lenders. 

Government Programs

Government funding can be great – if you can get it. Business advisory services and affordable financing can be found at both the provincial and federal level through the Business Development Bank of Canada (BDC) and other organizations. 

However, their funding is usually earmarked for certain groups of people, excluding certain entrepreneurs. For example, Alberta Women Entrepreneurs (AWE) offers interesting support service programs and business loans but only to companies that are owned by women. 

Finding the Right Loan Partner

In a distant past, the best financial partners were the ones you could find in your local community, but new technology has changed the lending landscape for the better. Instead of being limited to local options, Albertans, from Milk River to Grande Prairie and beyond, now have easily accessible online options through Lendified. 

Qualifying for Small Business Loans

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Small business loan requirements vary with each financial institution, but many alternative lenders tend to make it easier to receive a business loan. 

At Lendified, for example, applicants need to meet the same requirements as they would for a small personal loan with some additional information about their company and business activities. No matter the industry, from construction business loans to e-commerce loans to restaurant loans, Lendified treats all small businesses with the respect they deserve. 

In order to qualify for a small business loan from Lendified, business applicants must:

  • Be incorporated businesses in Canada
  • Be in operation for at least six months
  • Have over $100,000 in annual revenue
  • Have a personal credit score of 610 or higher (business credit score not required)

As with all forms of commercial loans, interest rates and conditions can vary, depending on a number of factors. In order to make your application as strong as possible, include a thorough business plan and a detailed budget that shows your potential lending partner how you intend to use your working capital in ways that will favour business growth and economic development. This roadmap, in addition to a good credit score, will almost certainly let you qualify for the small business loan you need. 

Having Trouble Getting a Business Loan in Alberta?

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If you are an owner of one of the many small businesses in Alberta that has had difficulty securing the right business loan, the following tips and tricks can help increase your chance of success on your next loan application. 

Revise Your Business Plan

If your business plan is missing detailed projections or critical information about how you intended to use and repay your loan, lenders might be skeptical of your ability to repay and your company’s long-term viability. Turning a critical eye to your business plan could help you find ways of making it more appealing to lenders and find ways of improving your operations. 

Improve Your Credit Score

A high personal credit score is often a requirement when borrowing from a bank, but low credit doesn’t automatically disqualify you from obtaining a small business loan. Being honest about your credit history will help lenders evaluate your character and give you options on the type of loan best suited for your business.

If you have a bad credit score, review your credit report to see exactly why your credit rating is low. Try to reduce your personal debt level below the 30% credit utilization threshold and make sure to be punctual on all your payments going forward. Although getting an excellent credit rating can take time, taking a few steps in the right direction will show a potential lender that you are serious about your finances. 

Consult an Expert

Sometimes, it takes an expert to find the best solution to the problem, and business financing is no different. If you have specific questions or general queries, the experts at Lendified will take the time to offer you the one-on-one support you need to make your next small business loan application successful. 

Click here to reach out online, getting the funds your business needs is within your reach!

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About the Author

Lendified

Lendified

Lendified is Canada's premier online lender for small businesses. The company was founded by former bank executives dedicated to provide businesses with fast, easy, and affordable financing. The Lendified team regularly produces blogs and guides to help small business owners succeed.

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