Going Bankrupt? Consider a Debt Management Plan

An alterative to Bankruptcy and IVAs: What are Debt Management Plans?

A debt management plan is a similar debt management solution to that of an IVA in that it is an agreement to pay back debt over a number of years, without the individual suffering from the constant fear of further pursuit from creditors.


However, unlike an IVA the debt management plan has no legal status within the court system and debts are not automatically written off at the end of debt management plans as they are with an IVA. However, offering to formulate a debt management plan is often a positive indicator to creditors that an individual is attempting to deal with debt problems in an organised way.

In short, creditors often look favourably upon debt management plans as they may stand to recover more debt in the long run than if an individual is declared bankrupt or enters into an IVA.

How to Obtain a Debt Management Plan: Debt Management Companies and DIY Approaches

There are two routes to obtaining a debt management plan, which is the best option will depend upon the confidence of the individual in negotiating with creditors, as well as the amount of time the individual is willing to invest in the debt solution.

  • DIY Approach – If an individual is confident enough to negotiate with their creditors and has sufficient time to do so, then a do-it-yourself approach may be the best way of formulating a debt management plan. Here an individual will inform each of the creditors of the intention to formulate a debt management plan using a set of standardised forms and offer to make regular repayments over a specified number of years.
  • Debt Management Companies – The more usual approach to obtaining a debt management plan is to approach a third party provider who will negotiate with creditors and handle both the debt management plan and the payments to be made to creditors. Whilst using a debt management company may be stress a relatively stress free solution to debt problems, debt management companies will make a charge for the services provided.

In summary, a debt management plan may be an appropriate alterative to bankruptcy, where an individual has multiple sources of debt but does not wish to enter into a legally binding debt solution, such as an IVA, administration order or debt relief order. However, one should consider that if a do-it-yourself approach is not taken, then debt management companies may charge significant fees, meaning that the total amount to be paid back will be more in the long term.

Financial aid

Federal and Provincial Financial Aid Programs for Exporters

The Small Business Finance Centre (SBFC) provides government funding to Canadian entrepreneurs who want to expand their export businesses into international markets.

The SBFC has hundreds of programs that provide grants and loan funding from $1500 to $10 million. The amount of funding depends on the size and financial requirements of an entrepreneur’s export business.

Details on the individual federal and provincial funding programs are currently available from the SBFC for a $594 fee payable in 2 installments. This fee covers a 7-year subscription to most recent data on government financial assistance.

Government Grants for Exporters

There are 3 major types of export grants available.

  • One-time and renewable grants enable exporters to upgrade their facilities, bring products to new markets and hire new employees without having to repay the government subsidy.
  • Equity financing for up to $10 million from the Business Development Bank of Canada (BDC); flexible debt repayment terms are provided.
  • Conditionally repayable grants; these include interest-free loans to be repaid only if the export venture is successful.

Government Loans for Exporters

While grants are more in demand as a source of funding for exporters, government loans are easier to obtain. Even when previously refused for a loan by private banks, applicants can qualify for the following types of government loans.


  • Low-interest loans with highly competitive rates that require no collateral
  • Government guarantee loans where the government co-signs on the debt, thus enabling an exporter to receive a bank loan.

Export Grants Success Stories

Winnipeg-based K9 Storm Limited used a $34,500 grant to introduce its unique body armor for police dogs into 12 countries, mostly in North America and Europe.

Garrison Guitar Works from St. John’s, Newfoundland parlayed a $250,000 government grant into 5 guitar prototypes. Now a multi-million-dollar company, Garrison ships 20,000 guitars a year to 29 countries and sells its products in 350 North American retails stores.

Another Winnipeg company, Airport Technologies, applied a $12,500 grant to develop a revolutionary snow plow used for airport snow removal. The company is now showcasing its flagship product called the Snow Mauler in U.S. markets including Buffalo, Chicago and Denver.

Export Loans Success Stories

Nova Scotian Keith Longmire was approved for an $8700 interest-free loan from the federal government’s Atlantic Canada Opportunities Agency. A maker of hand-painted birdhouses and bird feeders, Longmire used that government financing to produce marketing brochures as well as advertising for an international trade show in Atlanta. The Canadian wholesaler now exports his handmade bird feeders and houses to specialty stores in the vast U.S. marketplace.

Domaine Pinnacle Ice Cider in Québec received a much larger $300,000 government loan to cover fermenting vats, bottling equipment, corking machines, materials and labour. All these expenses were necessary for the commercial apple orchard to produce cases of high-quality apple cider. Domaine Pinnacle now has sales well over $1 million, and the company is ramping up production as its export business expands.

Agribiotics from Cambridge, Ontario used a $44,570 National Research Council loan approved by the Industrial Research Assistance Program. This cash injection enabled Agribiotics to win an international contract from the University of Wisconsin for developing a vaccine that protects corn from pests.

Export Business Plan Help

Most applicants commented that their most important lesson learned was the need for a well-organized and compelling business plan. This document was essential to companies winning a government grant or loan for their export initiatives.

Happily, specialized government service staff can help Canadian exporters develop a coherent business strategy.

An effective business plan is just as important as the government financing when launching an export business into new markets.

Financial aid