Restaurant loans are very hard to get nowadays especially in Canada.

• There is very little collateral or equipment for banks to attach in order to protect themselves.
• The restaurant industry is an industry with very high turn over and very few survive beyond 5 years.  As a result, bankers require the restaurant owner to personally guarantee any loan and will often require assets equivalent to double or triple the loan amount.
• Unless you have a very unique menu, ambience or fantastic service and relationship with your customers, it is hard to stop new and existing competition from taking your customers away.
• The current economic times force customers to eat from home more and also eat out at fast food places like MacDonald’s

Ottawa, Ontario (July 20, 2009) – The Government of Canada will provide $3 million through INAC’s pilot Loan Loss Reserve Initiative. The reserve fund works by offsetting a portion of the lender’s potential losses on loans to First Nation businesses, thus reducing the financial risks associated with lending to on-reserve First Nation businesses.