Canada Small Business Financing Regulations

12 The maximum annual rate of interest payable in respect of a loan as set out in the document referred to in subsection 10(1), on the day on which the loan is made or, if the document must be registered, on the day on which it is signed, must not exceed

• (a) in the case of a floating rate loan, the aggregate of 3% and the prime lending rate that is in effect at that lender on each day of the loan term, beginning on the day on which the loan is made; and

• (b) in the case of a fixed rate loan, the aggregate of 3% and

  • (i) the residential mortgage rate in effect at that lender for the loan term, or

  • (ii) in the case of a loan term of more than five years where there is no residential mortgage rate for that loan term, the five-year residential mortgage rate.