Business Funding for Canadian Businesses with Bad Credit
Quick answer: Yes, you can often get business funding in Canada with bad credit. Revenue-based options such as merchant cash advances and invoice factoring focus on your sales and deposits, not just your score. Expect higher costs than a bank, compare the total payback, and avoid stacking multiple advances.
Why a bank may decline, and another funder may not
Banks rely on personal credit, collateral and years of financial statements. Revenue-based funders look at the last few months of deposits, how long you have operated, and debts you already repay. Steady sales can matter more than a low credit score.
Your options
Merchant cash advance. This can be arranged relatively quickly. It is based on card sales and deposits into the business account.
Invoice factoring. This is for businesses that invoice other businesses and are waiting to be paid. The decision often depends on whether those customers pay.
Revenue-based payments. You repay a percentage of sales, so the payment is smaller when sales slow down.
What can still cause a decline
An open bankruptcy, frequent returned payments (non-sufficient funds) or overdrafts, very low or irregular deposits, or several advances you are already repaying.
How to improve your approval odds
Keep business deposits in one business account.
Reduce returned payments for a few months before you apply.
Send complete bank statements and photo identification at the start.
Ask only for the amount that solves the problem.
Watch for red flags
Upfront fees before an offer, no written total payback, pressure to sign the same day, or offers to "fix" your credit.
FAQ
Can I get business funding in Canada with bad credit?
Yes, often. Merchant cash advances and invoice factoring rely mainly on your sales or invoices rather than your personal credit score. If your business shows steady deposits and some operating history, funders may approve you even after a bank decline. Costs are usually higher than a bank's, so compare the total payback carefully.
What credit score do I need for a merchant cash advance?
Many revenue-based funders do not set a strict minimum score. They weigh your deposit history, time in business and any existing advances more heavily than your credit. Open bankruptcies, frequent returned payments (non-sufficient funds) or very irregular deposits are more common reasons for a decline. Each funder has its own rules, so requirements differ.
Will applying hurt my credit?
Applying through Growpath starts with a review of your bank statements and business details. A funder may run a credit check before making a final offer, and we tell you before that happens. Comparing several offers through one broker also saves you from filling in separate applications with each funder.