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SME Financing in Canada, 2003 — Part I: Financing Conditions for SMEs in 2001

Part I reports on some of the results of the recently completed supplemental Survey on Financing of Small and Medium Enterprises, 2001. The analysis focusses on commercial debt and lease financing (equity financing^{Footnote 6} is addressed in Part IV) and examines whether prevailing economic conditions compelled SMEs to change their behavior in 2001.

This part of the report is divided into four sections. Where possible, comparisons are made with the 2000 survey results:

The first section reviews the economic climate for SME financing in 2001.

The second section examines SMEs' demand for financing by reviewing application and approval rates for commercial debt in 2001.

The third section analyzes the type of debt instruments requested by SMEs and the conditions for accessing debt in 2001.

The last section examines SMEs' request and approval rates for lease financing, to determine whether the economic conditions in 2001 influenced requests and approvals.

•  1. The Economic Environment in 2001
•  2. Commercial Debt: Application and Approval Rates
•  3. Type of Debt Instrument Requested by SMEs
•  4. Lease Financing
•  5. Summary Tables

6. Data limitations linked to the sample size of the supplemental survey did not allow this type of analysis. Alternative sources such as the Macdonald & Associates Limited quarterly and annual venture capital activity reports and specialized studies commissioned by Industry Canada were used to provide an overview of equity financing in Part IV.

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