Four million businesses that were negatively impacted by the pandemic were awarded almost $390 billion in COVID Economic Injury Disaster Loans (EIDL).
$390 Billion in EIDL Loans Awarded to Small Businesses Through Pandemic
An unprecedented level of financial support by the Small Business Administration (SBA) to small businesses hit by the pandemic included the EIDL program.
During the life of the scheme, the SBA distributed approximately $390 billion to almost four million small businesses and non-profits.
In Partnership with American Rescue Plan-Funded programs
The EIDL was ran in partnership with the American Rescue Plan-Funded programs – the Restaurant Revitalization Fund, the Shuttered Venue Operators Grant, the COVID EIDL Targeted and Supplemental Advance Grants, and the Paycheck Protection Program.
The scheme was used by many small businesses as a means of funding critical business operations during the pandemic, just as assisting with payroll.
Empowering Small Businesses
In the first three quarters of 2021, small businesses in the US creating 1.9 million jobs. The SBA’s funding program, which helped empower small businesses during unprecedented, challenging times, played a vital role in job creation. The historical level of investment the SBA granted small businesses during the health crisis helped pave the way for the current high level of trust in the agency felt among the American people.
Talking about the success of the funding program, SBA Administrator Isabella Casillas Guzman, said:
“The SBA has delivered historic economic relief to millions of America’s small businesses through the COVID Economic Injury Disaster Loan program
“President Biden believes we can deliver government services and ensure critical relief gets into the hands of those who need it the most with equity, speed, and certainty. We delivered on his vision by revamping the COVID EIDL program to expand the delivery of low-interest, flexible loans to meet the continued needs of small businesses for financial relief so they could recover.
Anti-Fraud Measures
The SBA Administrator proceeded to talk about how the agency simultaneously developed anti-fraud measures to protect taxpayer dollars and ensure that funds benefited those Congress intended to help.
She added how almost 90% of loans went to small businesses with 10 employees or less. The recipients of the loans included many of the hardest hit businesses and many from the nation’s most underserved populations.
“The hardworking team members of the SBA and the Biden-Harris Administration will continue to use every tool at their disposal to support small business owners,” said Guzman.
Two Types of Funding
The COVID EIDL program comprises of two types of funding, COVID EIDL loan funds may be used for working capital and other normal operating expenses, and EIDL Advance funds, which are awarded to existing COVID EIDL applicants who meet certain criteria. COVID EIDL loan funds are not forgivable and must be repaid. EIDL Advance funds do not need to be repaid.
The success of the SBA COVID funding program, which helped small businesses navigate challenges and nurture economic growth, highlights the value of funding programs and wider assistance and support for the small business community.
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