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In the meantime, Ottawa was throwing billions into social security programs to help cushion the financial blow to Canadians. The federal banking regulator had also freed up $300 billion in lending capacity for financial institutions.

Photo by DAVE CHAN/AFP via Getty Images

Others in government did not share in that frustration, arguing that banks should not be asked to take on new and potentially unstable debts as the liabilities on their balance sheets swell.

So in a bid to reduce those risks, the Liberal government on Friday announced it would guarantee up to $45 billion in interest-free loans to small businesses, and co-guarantee another $20 billion for small- to medium-sized businesses. The move would minimize risk on at least a portion of the credit that firms will need amid the COVID-19 pandemic.

“With the measures announced [on Friday], there are no more excuses,” explained one source connected to the file. The person also acknowledged that the recent market collapse has had a “limiting” effect on banks’ ability to lend.

Nearly two weeks ago, the major Canadian banks also announced the possibility for Canadians to defer mortgage payments for up to six months.

Morneau on Friday said he knew Canadians were struggling to get access to loans.

Never in the history of the country has there even been an announcement like the one made over one week ago by the banks about mortgage deferrals of up to six months

“With respect to our discussions with banks, what we’re trying to say is not that we’re negotiating on particular rates. The banks will continue to act in a commercial way. That’s appropriate, but what we’re trying to make sure is that individuals, that small businesses, have access to credit,” Morneau said in response to a question about possible negotiations to have banks reduce interest rates on credit cards.