Guide: Corporate Credit for Canadian Businesses

Corporate credit is generally the first tool a business has to scale their operations and grow their business. In Canada, obtaining credit for commercial purposes is difficult. The current experience usually involves a long approval process, mixing personal and business credit profiles, getting small credit limits that don't enable scale and lack of transparency in fees. Or worse, businesses are forced to use prepaid or charge cards instead of growing with credit.

‍

Loop is a Canadian alternative to traditional banks in getting credit for your business, specifically corporate credit cards. We provide credit limits based on business revenue, not based on your personal profiles which means you can usually get a much higher limit compared to your traditional bank and scale your business faster.

Loop Cards support currencies in USD, CAD, GBP and EURO with no FX fees, annual fees or hidden fees. We've been lending for 8 years and are a member of the Canadian Lending Association.
‍

There are 3 important things that set Loop Cards apart from your bank's: 

1. You can accumulate a balance in USD, GBP, EURO and CAD as you make purchases in those currencies. When it's time to settle your balances, you can settle in each respective currency. This eliminates any forced conversion fees that your bank typically charges (up to 5.7%) per foreign transaction.
2. The interest-free period Loop offers is 55 days, which is about 15 days longer than a traditional business credit card you might see from a bank. Very useful for businesses managing cash flow in growth mode.
3. Loop Cards come with an entire suite of expense management features like AI-powered receipt matching, direct Quickbooks or Xero integration, payment approvals and more useful features for growing teams.

‍

Other quick wins from your Loop Cards: 

• No monthly fees, no annual fees
• Enable auto-pay for balances
• Earn rewards on all your card spend
• Create virtual cards and get physical cards
• Cards can support American & Canadian addresses

‍

How do I get a credit limit? 

‍

The first step is to create a Loop account and get verified as an operating business. Loop uses a proprietary scoring model to underwrite. We don't perform hard checks on your personal credit instead we've built a model that evaluates your business revenue.

Here are the steps: 

• Revenue is increasingly digital, so connect your Shopify, Amazon, Stripe, Square or Paypal channels directly to Loop. We'll then provide a credit limit based on your revenue over the past several months.
• If you don't use online channels, you'll have to provide more financial documents and bank statements to prove you're an operating and revenue generating business.
• The team may reach out with questions to understand your business even more. For us, it's all about the relationship.

‍

How do I qualify? 

‍

The team considers a wide range of variables to provide an appropriate credit limit for your business. For example, length of time operating, monthly sales etc.

‍

What are my options in terms of getting a corporate card?

‍

The main options in Canada are either traditional business credit cards or charge cards offered by tech companies. Here are the pros & cons:

Evaluating traditional cards: 

• High fees that are not transparent
• Small limits that are not scalable
• Lack of support
• Lack of expense management features
• Unpleasant online experience

‍

Evaluating charge or prepaid cards:

• Cannot carry a balance
• Does not build business credit worthiness

‍

Evaluating Loop cards:

‍

Loop combines the banking functionality of traditional banks with the powerful software of a tech company. We offer corporate cards powered by business credit, but also enjoy no fees, transparency and a compelling online experience.

‍

Who will benefit the most from Loop Cards?

• You're earning revenue in USD, GBP, CAD or Euro  
• OR you're making purchases in USD, GBP, CAD or Euro
• OR you're managing finances across a growing team
• OR you're a growing Canadian business

‍

What are the fees? 

• No annual fees
• No monthly fees
• No transaction fees
• No FX fees