Canadian government launches $4 billion Canada Digital Adoption Program

PM Justin Trudeau
Program to help some 160,000 small and medium businesses adopt digital technology.

The Canadian government announced on March 3 that it is investing $4 billion over four years to support up to 160,000 small and medium businesses to grow their online presence and upgrade or adopt digital technologies.

Prime Minister Justin Trudeau announced the launch of the Canada Digital Adoption Program (CDAP) at Ottawa’s innovation hub, Bayview Yards.

The money is meant to help small businesses bounce back from the lasting impacts of the COVID-19 pandemic, and adapt to the digital economy.

Canadian small and medium businesses will be able to apply for grants and loans through CDAP.

“Small businesses have shown incredible resilience over the last two years as they faced unprecedented challenges from the pandemic,” Trudeau said. “Supporting them has been – and will continue to be – a top priority for our government. That’s why we’re launching the Canada Digital Adoption Program to empower small businesses with the digital tools they need, while helping them create good jobs, particularly for young Canadians.”

The government estimates that the CDAP will create thousands of jobs, including nearly 30,000 job placements for young Canadians to gain work experience while helping businesses.

Through the CDAP, Canadian small and medium businesses will be able to assess their digital readiness, and apply for grants and loans online. The funds are meant to help them leverage e-commerce opportunities, upgrade or adopt digital technologies, and digitize their operations to stay competitive and meet their customers’ needs in the digital marketplace.

Depending on their size, specific needs, and goals, businesses can apply for funding through the Grow Your Business Online or Boost your Business Technology streams.

Grow Your Business Online will help up to 90,000 smaller businesses, including restaurants, tourism and recreation-based businesses that haven’t yet adopted digital technologies, take advantage of e-commerce opportunities.

Eligible businesses will receive micro-grants of up to $2,400 to help with the costs related to adopting digital technologies.

Grow Your Business Online will also support a network of up to 11,200 youth digital advisors who will provide advice to and help small businesses adopt e-commerce.

The Boost Your Business Technology stream offers grants to Canadian-owned small and medium-sized enterprises (SMEs) wanting to adopt new digital technologies.

Eligible businesses will have access to a marketplace of digital adoption experts to help them develop a digital adoption plan tailored to their needs.

Eligible businesses can leverage the grant to pay for the services of a digital advisor. These advisors will work with companies to recommend digital pathways and strategies to help them achieve their business goals and increase their competitiveness in the digital economy.

The grant covers up to 90 percent of the eligible cost of retaining the services of a digital advisor, up to a maximum grant value of $15,000 per SME, to develop a digital adoption plan.

Businesses also have the opportunity to secure a zero percent interest loan from the Business Development Bank of Canada (BDC) to facilitate the acquisition of new technology. In addition, applicants can leverage the help of talented post-secondary students and recent graduates through subsidized work placements.

To be eligible, businesses much be incorporated federally or provincially, or be a Canadian resident sole proprietor; be a for-profit, privately owned business; have one to 499 full-time equivalent employees; and have had at least $500,000 of annual revenues in one of the previous three tax years.

Retail e-commerce has rapidly increased during the pandemic, leading to new digital opportunities for SMEs. According to Statistics Canada data, year-over-year retail e-commerce increased by more than 110 percent in May 2020 compared to May 2019.

The Digital Adoption Program was originally announced as part of the 2021 federal budget. At the time, the Government of Canada called the budget “a plan to bridge Canadians and Canadian businesses through the crisis and towards a robust recovery.”

Other initiatives proposed under the 2021 budget included $1.4 billion over four years to ISED to provide Canadian businesses with access to skills training, microgrants to support tech adoption, and work opportunities for 28,000 young people to help SMEs adopt technology.

Image source Justin Trudeau Flickr account

Charles Mandel

Charles Mandel

Charles Mandel's reporting and writing on technology has appeared in, Canadian Business, Report on Business Magazine, Canada's National Observer, The Globe and Mail, and the National Post, among many others. He lives off-grid in Nova Scotia.

0 replies on “Canadian government launches $4 billion Canada Digital Adoption Program”