“As a country, we cannot afford not to have a very strong and powerful SME ecosystem,” said the president and chief executive officer of the Business Development Bank of Canada, the federal Crown corporation that provides financing and advisory services to about 100,000 small and medium-sized enterprises.
When Ms. Hudon began a five-year term as head of BDC in August, 2021, after a stint as Canada’s ambassador to France, she was determined to expand the bank’s client base. At the time, the bank was serving only about five per cent of the country’s SMEs – and less than 20 per cent of the businesses that, according to the bank’s own surveys, say they don’t have the support they need.
It doesn’t make a great recipe for future growth of the sector. Ms. Hudon said that BDC, which typically lends to businesses that have a hard time securing loans from private-sector banks, “needs to play a bigger role” to address this gap. The paper found that the Canadian sectors with the weakest productivity are also the ones with the highest proportion of employment in SMEs. It noted that Canadian SMEs are slow adopters of, and that entrepreneurs who develop their own innovations often sell them to foreign companies rather than commercialize those products themselves.