Resources to Help Canadians Through The Economic Fallout Of COVID-19

It’s only been a few weeks since Canada’s first confirmed case of coronavirus, and just about everyone is feeling the effects of the global pandemic in one way or another.

Even those fortunate enough not to contract the virus are getting accustomed to social distancing, mass closures and is bracing for difficult economic times ahead.

In recent weeks, however, all levels of government as well as private businesses have been acting around the clock to come up with ways to help Canadians minimize the damage. From deferrals to emergency benefits, it’s important to stay on top of the new policies and programs that can help you and your family through the crisis.

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1. Expansion of Employment Insurance

More than one million Canadians have signed up for employment insurance (EI) benefits as a direct result of COVID-19, and the federal government anticipates that number could reach four million in the coming weeks.

The EI Sickness Benefit provides up to 15 weeks of income replacement for those who are unable to work as a result of illness, injury or quarantine.

 To help get the these funds out to Canadians who need it most the Government of Canada is waving its typical one-week waiting period for new claimants, allowing people to backdate their EI claim if they are unable to apply, and are waiving the requirement to provide a medical certificate for those who are in quarantine.

2. Direct Support for Those Facing Unemployment

The government of Canada is also putting money directly in the hands of citizens who face unemployment through the new Canada Emergency Response Benefit, which provides a taxable benefit of up to $2,000 per person each month for up to four months.

The benefit similarly applies to those who are sick, quarantined or taking care of someone who has been diagnosed with COVID-19, as well as those who need to stop working as a result of the outbreak but don’t have access to paid leave or other income support. The benefit is also available to working parents who need to stay home without pay to care for children, those who are still employed but not being paid during a temporary work closure, as well as those who are self employed and wouldn’t otherwise be eligible for EI.

Residents of Canada are eligible if they earned at least $5,000 through work, EI or Quebec’s maternity and parental benefits for the 2019 calendar year or the 12-month period prior to submitting an application.

The benefit will be available through a secure web portal and an automated telephone line starting on April 6th.

April 4, 2020 Update: More Information About The Canada Emergency Response Benefit (CERB) Program

On April 1st the federal government provided more specifics on the previously announced CERB program, including eligibility requirements, application information and scheduling. The program is intended to provide $2,000 per month to Canadians that have been directly impacted by COVID-19. The most recent announcement clarifies that the CERB will provide Canadians with $2,000 per four-week period, backdated to March 15th, rather than being based on calendar months. Those who are eligible must also re-apply every four weeks for a maximum of four payment periods.

 

Canadians who are at least 15 years old, have stopped working involuntarily as a result of COVID-19, and had an income of at least $5000 in either 2019 or the 12 months prior to their application date are eligible to apply. Applicants must also have gone 14 consecutive days or more without an income since March 15th, or expect to not earn any employment income over the course of the four-week payment period.

 

Canadians who meet these criteria can apply online through the CRA My Account or by calling the automated toll-free phone line at 1-800-959-2019. Both are available between 6:00am and 3:00am daily, and applicants will be asked to provide their social insurance number and postal code.

 

In order to avoid overwhelming the system, however, the federal government is only allowing Canadians to apply on certain dates, corresponding with their birthdays. Those born in January, February and March can apply on Mondays, starting April 6th; those born in April, May or June can apply on Tuesdays, starting April 7th; those born in July, August or September can apply on Wednesdays, starting April 8th; those born in October, November and December can apply on Thursdays, starting on April 9th. Everyone that is eligible is able to apply on Fridays, Saturdays and Sundays.

 

The federal government also announced that direct deposit payments would be made within three business days. Those who are not setup to receive direct deposit through the CRA will receive a cheque by mail within 10 business days.

3. Increase to Child Benefits

Canadian parents will also receive a little extra financial support in the form of an increase to the Canada Child Benefit for 2019-2020. The federal government recently announced an increase of $300 per child, or roughly $550 per Canadian family, on average. The benefit will be automatically delivered as part of the next scheduled payment in May. 

4. Mortgage Assistance

Canadian mortgage holders are also getting a little bit of support in the form of a new mortgage deferral program. The program is designed to help those who are struggling to make their monthly mortgage payments, with all of Canada’s six biggest banks agreeing to allow mortgages to be deferred for up to six months. Since the announcement a number of alternative lenders have also agreed to follow suit, while others are taking applicants on a case-by-case basis.

Borrowers are encouraged to contact their financial institution before defaulting on a payment to ensure it won’t impact their credit score, and should expect longer than usual wait times.

As of a few days ago the banks reported receiving more than 213,000 requests combined. 

5. Student Loan Deferrals

Canadians who are currently paying off their student loans will also automatically have their repayments suspended until September 30th. That means borrowers won’t have to make any payments, won’t accrue any interest, and don’t need to apply in order to qualify.

6. Income Tax Filing and Payment Extension

Canadian citizens will also not be charged any penalties or interest for delaying their 2019 tax filings and payments. 

  • The new tax-filing deadline for 2019 is June 1st, 2020.
  • While payment won’t be sure until September 1st, including the June 15 instalment payment for those who pay by instalments.

These dates might get extended even further, so be sure to check the CRA’s website for updates.

7. Personal Loans

Though many financial institutions and alternative lenders are reducing hours or ceasing all in-person services altogether most continue to offer personal loans while staff work remotely.

  • Some, like Fairstone, are even providing dedicated products and services to help Canadians get the money they need to make it through the crisis.

Canadians who are seeking or currently paying off a personal loan are encouraged to contact their lender, but should anticipate longer than normal wait times. 

April 4, 2020 Update: goeasy donates $150,000

Despite the difficulties that the industry is facing Canada’s alternative lenders continue to open their hearts and their wallets to worthy causes. The most recent example is Mississauga, Ontario-based lender goeasy Ltd., which just announced a $150,000 donation to the Boys and Girls Clubs of Canada Relief Fund. “As partners of Boys and Girls Clubs for over 15 years, we know firsthand the critical role the Clubs play in the lives of so many Canadians,” goeasy’s President and CEO Jason Mullins recently said in a press release. “Our priority for this year is now to help keep critical programs running, especially those that provide support for those families in greatest need.”

Though the pandemic has already begun taking a significant toll on the economic wellbeing of Canadians most experts suggest it’s only the beginning of what could be a long and difficult recovery process. In the coming weeks this page will be updated with additional products, services and programs that become available to help individuals and families through the economic crisis that Canada is currently experiencing.  

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Jared Lindzon

Jared Lindzon is an experienced journalist, writer and public speaker. He specializes in Business, Technology, Lending and FinTech industries in Canada and abroad. Jared is a regular contributor to Smarter Loans and top tier publications around the World, including Fortune Magazine, Fast Company, the Guardian, Rolling Stone, the Globe and Mail, and many more.

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