Effective administration of SBA loans for COVID-19 could help the U.S recover significantly from the effects of the coronavirus (COVID-19) pandemic. The loan will help recovery by ensuring businesses are operating in the short-run and long-run, keeping and creating new jobs, preventing the bankruptcy of industries, encourage innovation and investment in sustainable business models.
While big institutions like airlines, banks, insurance companies, and manufacturing giants continue to seek bailout to avert the looming crisis, small businesses and individual entrepreneurs are likely to remain in operation through interventions of SBA loans for Covid-19 which provide relief and protection against closure. This relief ensures firms operate now and after the disaster, thus assuring their going concern.
Recovery of the U.S economy will be highly dependent on the jobs available even after the health crisis occasioned by coronavirus is over, even though we do not know when. Jobs are essential economic drivers, and any event leading to their loss can be detrimental. However, SBA loans for COVID-19 provide a facility to keep those in jobs in payroll even when the businesses are shut down to contain the disease spread through the provision of Paycheck protection loans. New posts could be created from the entrepreneurial development plan under the SBA loans for COVID-19. Entrepreneurs will play a significant role in recovery by solving challenges the country faces if they get the support and create more jobs, which are much needed for recovery.
Consumption has also been affected, and layoffs could be implemented in factories leading to more losses of jobs. Where people remain under payroll even when businesses are operating minimally or have closed could encourage consumption since people can afford it. The provision of the 10,000-dollar Economic Injury Disaster Loan Grants will help firms deal with working capital problems even when consumption rises sharply. The firms can have the capacity to produce despite liquidity challenges that could be prevailing. Bankruptcy and non-compliance with financial obligations by firms will be averted to a large extent through the intervention of SBA loans for COVID-19.
Innovative firms and entrepreneurs who could offer new investment opportunities will find a way of implementing their business ideas by accessing the fiances. Sustainable models of businesses are likely to emerge due to lessons learned during the pandemic. The programs supported by the SBA loans for COVID-19 to encourage entrepreneurship and business re-engineering processes will benefit significantly from these loans. This sustainability will be crucial in the recovery of the economy by building new frontiers.
In summary, SBA loans for COVID-19 offers great relief immediately, but its trickle-down effects are likely to reach the lowest economic participant. They are also going to have long-lasting effects on the economic trajectory, momentum, and sustainability. As any other pandemic or crisis such as the one experienced in 2008 offered lessons, coronavirus will also leave valuable lessons on economic recovery plans. These loans will be used to help in economic recovery using immediate as well as offer lessons. The review of its performance will be valuable in designing the recovery plan for the U.S economy now and in the future.