BDC LIFT Track B — the $5M AI + equipment combined loan.

What Track B actually is

Track B is BDC LIFT's combined AI-plus-equipment lane. Where Track A funds AI-only projects up to $2M, Track B funds projects where AI implementation work is paired with meaningful physical equipment investment. The combined ceiling is $5M, and the structure is a single loan rather than two parallel ones — single Advisory plan, single underwriting decision, single set of disbursement milestones spanning both the software and hardware sides of the project.

The "why this exists" question is the easier one to answer than most BDC product distinctions. Equipment-heavy Canadian SMEs — manufacturers running CNC lines, transport operators building out connected fleets, construction companies adopting AI-augmented surveying and commissioning gear — face a real problem when they try to fund AI alongside equipment. Track A's $2M ceiling is too low once the equipment line items are added, and conventional equipment financing rarely covers the AI implementation work that makes the equipment productive. Track B is the answer to that gap: one loan, one rate, one project, one integrator — for the band of SMEs where AI and physical equipment are genuinely the same project, not two separate ones.

Same structural shape as Track A on the financial side: up to 24 months of principal-payment postponement, longer amortisations (5–10 years typical, depending on the equipment useful life), and the 2.25% preferential rate when the Canadian-integrator clause is met. The longer amortisation is one of the underappreciated differences between Track A and Track B — equipment with a 10-year useful life can be financed against a 10-year amortisation, where AI-only Track A loans typically run 5 years.

What Track B covers

The combined nature of Track B means the loan funds both sides of the project under one set of disbursement milestones. The two sides:

• The AI portion (same scope rules as Track A): integrator design and build, integration labour, AI model spend, data infrastructure in service of the AI use case, change management, training, post-deployment measurement, and a defined warranty period.
• The physical equipment portion: production machinery, AI-enabled hardware, IoT sensors and fleet telematics, AI-augmented diagnostic and quality instruments, automated commissioning gear, robotics, precision-ag sensors, mining safety hardware. The equipment must be directly part of the AI deployment or made materially more productive by it — generic equipment unrelated to the AI work won't qualify under Track B.

Same Track A scope exclusions still apply on the AI side: no ongoing seat licenses for off-the-shelf AI tools, no CRM replacement projects with AI bolted on as cover, no generic marketing-website rebuilds, no working capital. On the equipment side, BDC will fund equipment that's part of the operating project, not real estate, leasehold improvements, vehicles unrelated to the AI work, or office furnishings. The Advisory layer reads both sides during scoping and pulls apart anything that doesn't fit.

The seven Track B industries

Track B is restricted to seven sectors where AI is most naturally paired with physical equipment. The restriction is structural — Track B is what makes the higher ceiling and the combined loan structure available, but only to sectors where the AI-equipment pairing is a real thing rather than a contrivance.

Outside these sectors, even an equipment-heavy project doesn't access Track B. If you're in retail, services, or another sector and you've got real equipment needs paired with AI work, the structure is usually Track A for the AI side plus separate BDC Technology Financing for the equipment — same lender, different products, different rate.

The 25% AI-blend rule

The single most-asked question about Track B is "how much equipment can I put in?" The working answer is the inverse: at least 25% of the project budget must be AI-related work. The remaining up to 75% can be equipment.

What counts as "AI work" for the blend test is the same scope as Track A: integrator design and build, integration labour, AI model spend, data infrastructure in direct service of the AI use case, change management. Equipment costs, installation labour, real-estate work, and ongoing operations don't count toward the 25% AI side of the ratio. The Advisory team reads the line items.

The honest tactical advice: don't engineer the ratio. If your real project is 60% equipment and 40% AI, scope it that way. If your real project is 90% equipment and 10% AI, it isn't a Track B project — it's an equipment-financing project. Trying to stretch the AI side to hit 25% with line items that don't justify themselves is the most reliable way to get the application bounced back from underwriting.

Equipment categories that qualify

BDC doesn't publish an exhaustive equipment list — they evaluate per project. The pattern in approved Track B applications is consistent: equipment that's either directly AI-enabled, directly fed by an AI system, or directly made more productive by one. Common categories we've seen funded:

Generic office equipment, vehicles unrelated to the AI work, real-estate fit-out, and equipment whose AI integration is purely aspirational ("we plan to add AI to this later") are out of scope. BDC's Advisory layer is built to surface this kind of mislabelling — better to scope honestly upfront than to get caught in underwriting.

The $5M cap — and how project size scales

The $5M Track B ceiling is the headline. In practice, very few first-time Track B borrowers come anywhere near it. The realistic distribution:

• $500K – $1.5M — entry-level Track B. Moderate equipment investment paired with a tight, well-scoped AI implementation. Typical for SMEs at $5M–$15M revenue making their first combined AI-equipment investment.
• $1.5M – $3M — the realistic sweet spot. Substantial equipment line items (a manufacturing cell upgrade, a fleet of connected vehicles, a precision-ag rollout across multiple operations) paired with the AI implementation work that makes the equipment productive. Most Track B loans land here.
• $3M – $5M — top-of-band Track B. Multi-site equipment deployments, integrated AI work spanning multiple departments, or a single transformational equipment investment in a manufacturing or transport context. Rarer than the $5M headline suggests; funded only when the operating need is genuine and the absorption capacity is real.

The same advice as Track A applies, with more force at Track B sizes: go smaller on the first loan than enthusiasm dictates. A $1.5M Track B that successfully ships a single line upgrade with the AI layer working is worth more than a $4M Track B that tries to upgrade three sites at once and stalls in implementation. BDC will write follow-on financing.

The 2.25% preferential rate for Track B

The Canadian-integrator clause works the same way for Track B as it does for Track A. The 2.25% preferential rate applies to the combined loan when the system integrator on the AI side is Canadian — incorporated, staffed, and delivering from Canada. BDC reads the integrator role, not the equipment vendor's nationality. You can buy German machine tools, Japanese robotics, and US-headquartered fleet telematics hardware under Track B — the rate clause is about the AI integrator, not the equipment supplier.

On Track B loan sizes, the rate effect is meaningful in absolute dollars:

On a $2M Track B loan, the integrator-choice question is worth roughly $160K of free margin over the loan's life — enough on its own to fund another significant AI workflow inside the same project scope. The Canadian-integrator rate post covers the BDC clause in detail.

Typical Track B project shapes

Four anonymised Track B shapes that illustrate what the combined AI-equipment financing looks like in flight. Dollar bands rounded; identifying details removed.

When Track B is the wrong choice

Track B is the right answer for a specific shape of project — AI plus equipment in the seven eligible sectors with a real 25% AI blend. Outside that shape, other tools fit better:

• AI-only project, no meaningful equipment. Use Track A — $2M ceiling, simpler underwriting, same 2.25% rate. Bolting token equipment onto an AI-only project to qualify for Track B is the wrong move, and BDC's Advisory layer will pull it apart.
• Pure equipment, AI under 25% by budget. Use BDC Technology Financing — the regular BDC equipment-financing line. The rate isn't 2.25%, but the underwriting is faster, the Advisory engagement isn't mandatory, and the project doesn't need to defend an AI blend that isn't really there.
• Outside the seven eligible sectors. Even with equipment needs and real AI work, if you're in retail, services, hospitality, or a sector outside the Track B seven, you'd structure the AI side under Track A and the equipment under separate BDC Technology Financing.
• Sub-$5M revenue. Track B's revenue floor is $5M, higher than Track A's $1M. If you're under $5M, Track A is the available LIFT option even if equipment would otherwise make sense in the project. The eligibility page covers the full set of hard tests.
• Project is really AI research, not implementation. If the work is exploratory — "what could AI do here?" — that's NRC IRAP territory, not LIFT, regardless of equipment involvement.

Track B FAQ

Where to go next

If Track B looks like the right shape — $5M+ revenue, one of the seven eligible sectors, a real AI-plus-equipment project — the practical next steps are short:

• Confirm eligibility against the hard tests, including the higher $5M revenue floor specific to Track B.
• Request a LIFT readiness assessment — the technical document that becomes the spine of the Advisory plan you take to BDC.
• Run the LIFT calculator to see what a project at your blend ratio realistically looks like at the 2.25% rate.
• Read the Track A page if you're not certain whether your project is AI-only or genuinely AI-plus-equipment. The choice between the two is worth thinking through before scoping the Advisory engagement.
• If the project is mostly equipment with AI under 25%, look at BDC Technology Financing as the better-fitting product.
• Book a 30-minute scope call. We'll walk through what a defensible Track B application looks like for your business — including the 25% blend math — and tell you whether to proceed.

For background reading, the "What is BDC LIFT" primer is the right pre-read if you're still mapping the program landscape. The Canadian-integrator rate post walks through the 2.25% clause in detail, which becomes more financially significant at Track B loan sizes. The Scale AI vs. BDC LIFT comparison covers how Track B sits against Scale AI Canada for sectors where both could apply. Or step back to the main LIFT hub for the full program overview.