If your business sells outside Canada, cash flow and risk are regular concerns. Two federal Crown corporations—Export Development Canada (EDC) and the Business Development Bank of Canada (BDC)—offer financing, but they help exporters in different ways. Understanding how EDC financing and BDC financing work can help you choose the right fit for your export plans.
Both organizations support Canadian businesses. However, only one focuses mainly on international trade. The right choice depends on where your customers are, how you get paid, and how much risk you can handle.
EDC’s main goal is to support Canadian exports and foreign investment. Its financing products help reduce the risks that come with selling to buyers outside Canada. This is especially important when dealing with new or international customers.
Common EDC financing options include:
Export guarantees
EDC can guarantee part of a loan from your bank. This lowers the lender’s risk and can help you get larger credit limits tied to export contracts.
Accounts receivable insurance
This protects your business if a foreign buyer does not pay because of bankruptcy, insolvency, or political issues. Insured receivables can often be used as collateral with your bank.
Direct lending for international growth
Sometimes, EDC lends directly to exporters or their foreign buyers to support Canadian export contracts.
EDC financing is most helpful when your growth depends on exports. The products usually work with your existing bank, not instead of it.
BDC focuses on helping Canadian businesses grow in Canada, but it can also help exporters. Its role is to fill financing gaps where traditional banks may be cautious, especially for smaller or fast-growing companies.
Common BDC financing options include:
Term loans and working capital loans
These loans can be used for hiring, buying equipment, expanding, or general cash flow needs. They work whether your sales are in Canada or abroad.
Growth capital and subordinated financing
BDC can take more risk than traditional lenders. It may offer longer repayment terms or interest-only periods.
Advisory services with financing
BDC often pairs financing with advice on scaling, financial management, or operations.
BDC financing is not export-specific. It works best when your export activity is part of a bigger growth plan.
Here’s how EDC financing compares to BDC financing for Canadian exporters:
Export focus
Risk coverage
Relationship with your bank
Right fit for
Tools like GrantHub’s eligibility matcher can help you filter export-related funding and support programs by province and industry in seconds. This is useful when you want to combine financing with grants.
Yes, many exporters use both.
A common structure is:
This layered approach is common for exporters who deal with long payment terms or higher overseas risk.
Assuming EDC replaces your bank
EDC usually supports bank financing, not acts as your main lender.
Using BDC for risky foreign receivables
BDC loans do not protect you if an international customer does not pay.
Waiting until cash flow is tight
Both EDC and BDC financing are easier to get before you face export-related cash flow problems.
Ignoring grants with financing
Export financing often works best when combined with non-repayable programs that help cover market entry costs.
Q: Is EDC financing only for large exporters?
No. EDC works with small and mid-sized businesses, especially those entering new markets or selling to new foreign buyers. Eligibility depends on export activity, not company size.
Q: Can startups qualify for BDC financing?
Some startups can qualify, especially if they have revenue or strong growth potential. BDC usually looks at viability and management strength.
Q: Does EDC offer grants?
No. EDC provides financing, guarantees, and insurance. Export-focused grants are offered through other federal programs.
Q: Which is cheaper, EDC or BDC financing?
Costs vary by product and risk. EDC pricing reflects export risk, while BDC pricing reflects business and growth risk. Compare offers case by case.
Q: Do I need to be exporting already to work with EDC?
Not always. Businesses preparing to export or bidding on international contracts may still qualify.
GrantHub tracks hundreds of active grant programs across Canada. Check which ones match your business profile if you want to combine financing with export grants.
Choosing between EDC financing and BDC financing depends on how important exports are to your growth and how much risk protection you need. Many Canadian exporters use both, along with grants that help lower upfront costs. GrantHub helps you see these options in one place, so your financing and grant strategy can work together.
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