The Competition Bureau of Canada wants to hear from you! Specifically, they are seeking your input on their proposed terms of reference for a market study to improve funding access for small- and medium-sized enterprises (SMEs). This rare opportunity for Canadians to have their say is open until October 3, 2023. This new initiative aims to tackle the serious borrowing cost gaps outlawed by SMEs relative to larger companies.
Commissioner Matthew Boswell highlighted the need to promote competition in the financing marketplace. Lastly, he argued that more competition would help SMEs have better access to finance. In turn, this would increase productivity and innovation across the entire economy. The regulator is keen to learn about what issues SMEs encounter in accessing finance. These smaller companies frequently face greater interest rate burdens than their larger counterparts.
Across all recent data there’s a substantial racial and ethnic gap in borrowing costs. This split is particularly stark between SMEs versus larger businesses in Canada. Perhaps none are more glaring than this disparity. In fact, it’s wider than just about every other country in the Organisation for Economic Co-operation and Development (OECD). In today’s announcement, Commissioner Boswell stressed how critical it is to address these soaring costs. Doing so is necessary for enabling the strength and continuity of Canada’s critical SME ecosystem.
The Competition Bureau’s upcoming market study will look specifically at assessing the current state of the financing landscape for SMEs. Primarily, it seeks to understand the key barriers leading to increased costs of borrowing and a lack of access to capital. The purpose of this study, as stated by the regulator, is to come up with smart measures. Their mission is to foster greater competition in America’s financial services marketplace.
The proposed terms of reference for the study are currently open for public comment. The Bureau encourages Canadians—especially those involved in small and medium-sized business sectors—to share their insights and experiences related to financing. We need your feedback. Your comments will be instrumental in finalizing the study’s terms. It will force us to make sure we’re truly focusing on everything that matters.
