It may not seem like it, but many Canadian small businesses rely on government funding. In fact, recent estimates indicate that about 27% of Canadian small businesses seek external funding, and about 7% of these small businesses seek government financing.
So if you’ve been looking to explore government grants for a small business in Canada, you’re not alone. In today’s blog, Bizfund shares 2026 government incentives and grants at the provincial and federal levels. We also share funding alternatives for small business funding if you don’t want to or cannot qualify for government-backed financing.
Federal Grants for Small Businesses in Canada
If you’re looking into government grants for small businesses in Canada, you need to explore a few federal options. Below, you’ll learn more about three of the best options:
Industrial Research Assistance Program (IRAP)
Canadian small businesses that are developing prototypes, new technologies, or research-driven products can consider the Industrial Research Assistance Program (IRAP). The IRAP can grant you funding, but the amount will vary widely based on your project size.
However, based on past data, smaller R&D projects usually receive modest support, but more innovative projects can secure financing of up to $10 million. In addition, you should know that the IRAP usually funds up to 80% of labour and 50% of subcontractor costs.
If you want to apply for this government grant in 2026, you should know that applications are accepted on a rolling basis. This means you can expect a review of your application at any time in the year after you apply.
Canada Small Business Financing Program (CSBFP)
One of the best ways for small businesses in Canada to secure funding is to apply through the Canada Small Business Financing Program (CSBFP). This loan program (because it’s technically not a grant) can help your business secure affordable funding through partnerships with lenders that share the risk.
If your business is eligible, you could access a loan of up to $1,000,000 through this program. You could use this funding to invest in leasehold improvements, equipment, and technology upgrades, including digital tools, systems, and software that support modern operations.
Since this federal program is offered through participating institutions, loan terms and rates are set by them and not the government. In addition, funding will likely be available on an ongoing basis in 2026.
NRC IRAP Clean Technology Program
Is your small business developing clean tech innovations that improve energy efficiency, reduce emissions, or address environmental challenges? If so, you might want to consider the NRC IRAP Clean Technology Program. The NRC IRAP Clean Technology Program is continuing the federal clean-tech mandate that the SDTC began.
With this program, you could receive varied funding, depending on the technical complexity and scale of your project. Based on recent information, application intake cycles occur throughout the fiscal year. However, official 2026 intake windows will likely be announced later through NRC IRAP’s official channels when they finalize their budgets.
Provincial Programs in Canada for Small Businesses
Government grants for a small business in Canada that falls within the provincial category can be hugely beneficial.
These grants often offer less competition, have easier application processes, and better align with specific regional needs. If you’re considering applying to a provincial program in Canada, here’s a look at a few top options:
Ontario: Ontario Creates and Regional Economic Funds
In Ontario, two popular provincial government grants include Ontario Creates and Regional Economic Funds. The former is specifically for small businesses in creative industries like digital media, film, and publishing. In contrast, the Regional Economic Funds are for general small businesses seeking funding for job creation, equipment upgrades, and training.
If you’re looking into the Ontario Creates grant, you should know that grant amounts vary by stream, but you could secure up to $500,000. However, you’ll likely need to use it for content production, business growth, or project development. For the Economic Development Funds, the grant amounts are similar.
In addition, for both Ontario provincial government grants, applications are open several times a year. You can learn more about when the first 2026 cycle opens after provincial budgets are finalized.
British Columbia: Innovate BC
In British Columbia, Innovate BC offers several provincial grants to support hiring, R&D, and innovation partnerships. For example, there is the Innovator Skills Initiative that your small business could apply to. This program can provide up to $10,000 in hiring subsidies.
There is also the Ignite or Innovate BC R&D vouchers. These can exceed $10,000, but the range will depend on the industry your business operates in and the project size. The 2026 application cycle has not yet been announced, but you can expect intakes to occur periodically.
Alberta and Québec: Innovation and Manufacturing Support
In Alberta, the Alberta Innovates grant program funds clean energy, tech, and agriculture projects. For small businesses, many grants range between $10,000 and $100,000.
Then, in Québec, there are Investissement Québec programs. These programs fund automation, export expansion, and manufacturing upgrades.
Grant size-wise, it depends on your business’s project, but companies are often awarded sums in the tens of thousands or more. In addition, regarding intake, both programs should operate on rotating application cycles for 2026.
Funding Alternatives to Government Grants for Small Businesses’
Not every small business qualifies for, or manages to secure, a government grant at the provincial or federal level, but that doesn’t mean there aren’t alternative options. Below, we share alternative financing solutions you might want to consider if you’re looking for small business or entrepreneurship support:
- Business lines of credit: You can gain ongoing access to working capital with a business line of credit. Often, lines of credit can help support seasonal changes, cash flow gaps, and short-term expenses for your small business.
- Bank and credit union term loans: You could apply for a traditional bank or credit union loan. These are fixed-term financing solutions that you can use for vehicles, equipment, expansions, or renovations. However, how much you can get will vary based on your revenue, creditworthiness, and collateral.
- Merchant cash advances: Often, a merchant cash advance is one of the best financing solutions for those who need between $10,000 and $300,000 and who need access to these funds quickly. You can use this upfront capital to fund cash flow, equipment, upgrades, and more. However, you will repay this capital through a percentage of daily or weekly card transactions, making them a good option if you have strong card sales.
These are only a few of the options you can explore, but most find one of the above to be a better fit when government grants don’t cut it.
Eligibility and Application Tips
Eligibility for federal and provincial government grants for small businesses in Canada can vary, as can the criteria for alternative funding.
When it comes to federal programs, you’ll need a Canadian business and the ability to offer a clear project plan and defined outcomes. You also need to have the capacity to deliver measurable results. In most instances, if you have a strong proposal, you will demonstrate to federal grant programs that it offers economic benefit, innovation, or a positive environmental impact.
In contrast, since provincial grants for businesses focus on regional value, you need to operate within the province for which you’re applying for the grant. You also need to demonstrate how your business or its project will support local priorities. Usually, this means showing how you will support job creation, competitiveness, skills development, or growth in key sectors.
Then, when it comes to alternative financing, requirements are more flexible. This is because traditional lenders consider revenue stability, creditworthiness, and financial history, while online lenders like Bizfund focus more on cash flow and recent bank activity than collateral.
Tips to Strengthen Any Application
If you want to strengthen your application for a government grant or alternative financing, there are a few tips you can follow:
- Outline goals, timelines, and the results you expect in a clear and simple business plan.
- Organize and keep financial statements, bank records, and tax filings.
- Learn how to show that your project will benefit customers, the community, and your business.
- Make sure you create a realistic budget or estimates with quotes to support your numbers.
- Ensure you can prove cash flow or the ability to manage project costs responsibly and transparently.
How to Combine Loans and Grants
You can combine small-business funding solutions, such as loans and grants. To do this, you can use each type of financing for the part of your project that suits you best.
For example, you can use a government grant for early development, research, and digital upgrades or for pilot initiatives. On the other hand, you can use loans or merchant cash advances to hire, build inventory, scale, and purchase equipment.
If you can determine early on which funding will go where, you can create a balanced financing strategy that helps reduce risk, protect cash flow, and support long-term growth.
Key Takeaways
There are many different types of government grants for a small business in Canada in 2026. However, the choice you make will depend on your needs and goals. You also have the option of going with an alternative financing route if you don’t qualify or don’t want to try for a government-backed grant. If you’re going to explore alternative financing like a merchant cash advance, you can learn more about it here at Bizfund.
