Canada just put another $500 million on the table for artificial intelligence. The money goes to small and medium-sized businesses, not moonshot labs.
On October 13, 2026, the federal government announced the new funding for the Regional Artificial Intelligence Initiative, better known as RAII. The cash will flow over five years. Total federal support for the program now reaches $700 million.
What the money is for
Minister Evan Solomon made the announcement. It fits inside a broader plan called “AI for All,” the National Artificial Intelligence Strategy the government launched in June 2026.
The expanded RAII has two jobs. The first is helping businesses actually use AI, with a heavy focus on SMEs. The second is helping Canadian-built AI products get commercialized and scaled.
The program targets a specific list of priority sectors:
- Health
- Energy
- Transportation
- Agriculture
- Manufacturing
The track record so far
RAII is not brand new. It launched in 2024, which gives the government a couple of years of results to point to.
Since then, the initiative has backed 218 projects. Those projects created or maintained over 1,100 jobs, according to the government’s figures.
The more interesting number is leverage. For every dollar RAII approved, projects drew in approximately $1.77 in additional funding.
Sovereignty is the subtext
The government tied the new funding to a theme it has been leaning on: AI sovereignty. The idea is that Canada should keep its AI talent, and the intellectual property they produce, inside the country. Officials also framed it as a way to spread economic benefits more widely across Canada.
How to apply, and when
Applications are open now. Deadlines vary by region, so businesses will want to check the rules for wherever they operate.
Southern Ontario has one of the clearest timelines. Firms there that expect project costs before March 31, 2027, need to submit by January 19, 2027.
Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.