Can a non-resident buyer use a Canada Small Business Financing Program or BDC loan to buy a Canadian business?

A buyer who lives outside Canada may ask whether two federal sources of small-business lending are open to them. The honest answer from the federal sources is narrower than a yes or no. Both programs are tied to the business, and both leave approval to the lender. This page covers the Canada Small Business Financing Program and BDC only. It says nothing about bank mortgages or any other lender’s policy, and the foreign buyer answer covers the approval and competition rules.

What the Act ties the loan to

Under the Canada Small Business Financing Act, a small business means a business carried on, or about to be carried on, in Canada, with an estimated gross annual revenue that the Act limits, and it does not include the business of farming. Section 4(1) sets conditions, in addition to any prescribed ones, including that the loan be made by and with the consent of a lender to a borrower who meets the eligibility criteria in section 4(2), which include prescribed criteria, that it be in respect of a small business, and that it fall within a prescribed class of loans. The definition of small business speaks of where the business is carried on and its revenue; it does not mention where the buyer lives.

What the Regulations let a loan pay for

Section 5(1) of the Regulations lists the classes of loan. They include financing the purchase of intangible assets and working capital costs, and the purchase of real property the borrower is or will become the owner of, if it is necessary for the operation of the small business. Section 5(2) adds conditions on how much of that property the business must use and on resale or leasing. Ask the lender whether the way the purchase is structured fits one of those classes.

Who decides

Innovation, Science and Economic Development Canada states that your financial institution is responsible for making the decision to approve your loan. For a non-resident, that makes the lender’s own requirements the question to ask first. BDC’s page for its Business Purchase or Transfer Loan says the business must be located in Canada and generating revenue. Its small business loan page lists a business located in Canada among the criteria that make you more likely to qualify. Neither page, as read on 25 October 2026, says anything about the buyer’s residence.

What to ask before applying

• Ask the lender in writing whether it will consider a borrower who lives outside Canada.
• Ask which documents it needs and whether a Canadian company must be the borrower.
• Ask whether the purchase falls in a class of loan the Regulations list.