How to apply for the Canadian Digital Adoption Program Stream 1 Micro-Grant

Be one of 90,000 small businesses to get the $2,400 Grow Your Business Online grant.

CDAP Stream 1

Updated: April 4, 2024

The CDAP Program developed by the Government of Canada aids small and medium-sized businesses in increasing their competitiveness by adopting digital technologies. As most government grants, they are given on a first-come first serve basis.

Although the CDAP Stream 2 program closed for new applications on February 20, 2024, CDAP Stream 1 still remains open for new applications but we expect it to close before the originally planned end date in March 2025.

See below for CDAP eligibility and eligible cost, or skip straight to the CDAP application instructions.

CDAP Stream 1 Eligibility

Eligible and Ineligible Costs

Most Canadian registered businesses are eligible for the Grow Your Business Online Grant for $2,400.

You are eligible if your Canadian business:

Is registered or incorporated
Is consumer-facing and for-profit
Has at least one employee or 30K in annual revenue (if solopreneur)

Note: the grant eligibility criteria was expanded in October 2022 to include companies with gross revenues over $30,000 in the last 12 months of operation (no employee requirement). If you’re not sure if your business is eligible, contact Innovation, Science and Economic Development Canada (ISED) directly via their CDAP contact form / chat or toll-free in Canada 1-800-328-6189.

The following is directly copied from an email to a successful applicant from the government:

Purchases must be related to eCommerce (ie. buying and selling online). It cannot be a business cost like Wi-Fi connectivity. It should be directly related to e-commerce, so provide a rational reason for your item description!

Micro-grants are reimbursements, meaning that you will only be reimbursed for costs after the grant approval date.

Microgrants are also in the form of an EFT. You will get detailed instructions by email about this as well.

You must be adopting something new—hence the name Canada Digital Adoption Program! The micro-grant does not cover the cost of an existing Shopify or marketing plan you already adopted before participation in CDAP.

The last thing to remember is that the grant does not cover tax, so you may want to go over the $2400 maximum amount. This also ensures you get the most money possible in case any costs are ineligible after our grant reviewers review your submission. So, for instance, you spent $2400, including tax, you would be reimbursed less than that. Say that one of your costs was also ineligible, and you would be reimbursed even less.

In addition, Small Business BC provided these bullet points (this applies across all provinces and territories):

Eligible costs include, but are not limited to, the following:

Costs related to the implementation or improvement of a digital e-commerce plan (e.g. online reservation/booking tools, online ordering systems, electronic payments)
Costs related to website search optimization (SEO)
- Plan cannot be used solely for website search optimization, it needs to be tied to overall e-commerce implementation plan, and not a standalone item
Costs related to the installation of an e-commerce platform (including subscription fees/costs)
Costs of back-office solutions to support an e-commerce strategy
Costs of social media advertising (Plan cannot be strictly social media advertising, it needs to tie into overall e-commerce implementation plan)
Costs related to the creation of customer databases
Hiring a consultant/agency to execute Digital Marketing initiatives related to your e-commerce store
Development of new e-commerce website
Upgrading existing e-commerce site for added functionality (i.e., new plugins, or features)
- Redesign of an existing site is not eligible
E-commerce software including:
- Software to track and manage product inventory, as well as fulfill and ship orders
- Software for product databases
- Software to track sales, market to customers, offer discounts, maintain a loyalty program
- Software to simplify marketing
- Cyber Security software or certifications
Hardware and accompanying software up to 20% of total grant amount
- As for examples of limited coverage for software, it would be any software that is bought with equipment that is required to support an e-commerce strategy. For instance, if a small business buys a new e-commerce integrated point of sale (POS) system that costs $1,300, CDAP will cover 20% or $260.

Ineligible costs include, but are not limited to the following:

Costs of connectivity
Costs related to the shipping of goods purchased through the e-commerce platform
Purchases made prior to grant approval
Office Software (e.g.. Microsoft Office, iWork,
Google Workspace, etc.)
Renewal of digital services such as domain name, software subscription etc.
Signage and printing
Logo redesign and rebranding
Business Owner’s salary or current employee salary for executing the project
Costs of land, building or vehicle purchase
Costs of intangible assets such a goodwill, whether capitalized or expensed
Depreciation or amortization expenses
Interest on invested capital, bonds, or debentures
Bond discount
Monthly mortgage, loan and/or rent payments
Refinancing of an existing debt
Losses on investments, bad debts, and any other debts
Fines or penalties
Costs related to litigation
Fees for administrators including payments to any member or officer of the Recipient’s Board of Directors
Opportunity costs
Hospitality and entertainment costs
Franchise tees and/or franchise license costs
Lobbyist fees
New capital expenditure
Consulting fees for submission of COAP application or any costs not related to the acquisition or set up of technology solution
Non-arm’s length transactions (see eligibility FAQs for further details)

Other costs maybe eligible. After completing your application, ask your government-assigned e-Commerce advisor if you have questions about eligibility. If you haven’t applied yet, contact ISED directly.

Sources:
Small Business BC Grow Your Business Online Program (eligible & ineligible costs)
Grow Your Business Online: Service Provider Application Guide

Guide to the CDAP Stream 1 Application

What You’ll Need to Start

Before you start, here’s what you’ll need to have on hand:

Business registration number
GST/HST number (if you have one)
Annual revenue
Digital copy of business registration or articles of incorporation.

The application process will take 20 – 30 minutes.

Step 1 - Start CDAP Stream 1 Application

To begin, go to the ISED Canada CDAP page.

Select the Get up to $2,400 to grow your business online option.

Step 2 - Apply for CDAP Stream 1

Scroll down and click the Apply now button.

Step 3: Select your Regional Service Provider

If your business is registered in B.C., select British Columbia and select Small Business BC as your local or regional service provider from the drop down. You’ll be taken to the SBBC site.

Each province has different organizations that administrator the grant – the rest of this guide has screenshots from the SBBC / Digital Main Street path as an example, but the questions steps after registration in step 7 are similar (jump to step 8).

Note that for indigenous businesses, you will apply separately through the Canadian Council for Aboriginal Business or your local service provider.

Step 4: Check Your CDAP Eligibility

Scroll down and click Apply now button.

Step 5: Begin Your CDAP Application

Review the eligibility criteria to ensure that your business qualifies for the CDAP grant.

Once confirming that your business is eligible, scroll and select this second Apply Now button.

Step 6: Create an Account on Digital Main Street

Now, you will be transferred to Digital Main Street’s CDAP Grow Your Business Online page.

Click the Create an Account Now button, or login if you have a Digital Main Street account already.

Step 7: Fill in Your Contact and Account Details

Follow the instructions to create an account.

Enter your personal and business info to create your account, check the privacy confirmation and click Create.

Note: if you have a Digital Main Street business account, you’ll need to create another account with a different email.

Step 8: Fill in Your Business Information

Input your business information. You will need to put in the following:

Your business name and contact information
Primary Business Address
Business improvement Area (BIA)
Business Type
How long have you been in business, and your expansion timeline
Industry type

Once you’re done, click on Continue.

Step 9: Complete the 5-Page Digital Assessment

This step takes approximately 5 minutes and asks a series of Yes/No questions such as whether or how you use a CMS, Google Analytics, SEO, social media and e-Commerce.

These questions are used as part of the Digital Main Street account, not CDAP, so you don’t spend too much time on it. You can leave the defaults and opt out of partner’s communications.

Step 10: Fill Out CDAP Eligibility Form

Check your email for a confirmation that your account has been successfully set up up.

Then sign in to your newly created Digital Main Street account, and follow the link in your email to fill out the CDAP Eligibility form.

Step 10.1: Enter Your Contact Information

Enter your contact information.

Under Who is completing the application?, select one of three options:

Business Owner
Employee
Third Party

Note that all sections except ‘Job title’ are mandatory to fill out.

Step 10.2: Enter Your Company Information

For the Company Information portion of the Eligibility form, you will need to know your business:

NAICS code
Registration number
GST/HST number (optional)
Annual revenue
Approximate Square Footage of Location

As of December 2022, the form still shows a required file upload for your articles of incorporation.

Until their site is updated and if you’re not incorporated, upload your business registration to get past it.

For the following Diversity and Inclusion section, and recognize the social diversity of your workforce by checking the relevant boxes.

Step 10.3: Select the Relevant Attestation

Remember that your business must have at least one employee on the payroll, not the owner or a contractor, or have at least $30,000 in annual revenue in the most recent tax year.

Then, select one of the options that best describes your business.

Following this section, you will be expected to declare further attestations regarding funding, commitment to your digital adoption strategy, and the accuracy of the information you have input.

After selecting Submit, you can await your grant’s pre-approval.

Average Wait Times for CDAP Approval

After submitting these forms, you’ll receive an email from Small Business BC stating “Our team is reviewing the information you provided and will provide an update within 7-10 business days.”.

Note: as of December 2022, our clients have reported wait times around 5-6 weeks.

What's Next?

First, you’ll receive an email from SBBC that your intake form has been accepted.

Then you’ll be asked to schedule a one-hour consultation with a government-provided E-commerce advisor (not to be confused with a CDAP digital advisor).

In this first consultation, you’ll go over your business, your goals, the CDAP Dashboard, and a review of your Digital Assessment. They’ll also go over the micro-grant process, resources, and answer any questions you’ll have on eligible costs and help you prepare a proposal on how to spend the funds.

Once your proposal is submitted, you’ll have 90 days to submit the spending plan to get reimbursement.

How to use the CDAP Grant

It’s encouraged to use the grant for a combination of marketing efforts. We’ve seen the most success with website optimizations, adding booking systems, SEO audits, social media plans and Google Analytics 4 migrations.

Learn more about the Canada Digital Adoption Program

For all Stream 1 related pre-application questions, contact ISED directly.

If you’ve been approved for the grant and are looking for the best way to invest it, get in touch with us!

Big Cedar is an approved CDAP digital advisor.