A few young women I mentored have really been hit hard by COVID-19.
They were on the verge of getting their businesses off the ground, with every step of the way perfectly planned out. Now, nothing is certain except for the fact that those plans are no longer perfect.
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Will COVID-19 Affect Small Business Loans For Women?
One thing in particular for these entrepreneurs is whether they will still be able to get the small business loans they had planned on. This fear is based on a number of factors:
- Will lenders still be capable of providing capital to all worthy applicants?
- Can private lenders weather the storm and survive themselves?
- What effect will personal losses, including unpaid debts resulting from COVID-19 related circumstances, have on an applicant’s chances?
- Are investors going to pull out of small businesses that no longer have a clear path forward?
These are all serious questions, but the reality is that there are actually benefits to the fact that the whole country (and the world) is going through this. Whereas the free-market ideals of capitalist America would usually make it difficult for lone small businesses to recover from setbacks, the risk of the small business sector collapsing as a whole is unthinkable in a macroeconomic sense.
Here are the ways small business loans might help you through and beyond the COVID-19 crisis.
Small business loans for women
As you probably already know if you have been counting on a small business loan, there are various options, specifically for women. The federal Small Business Administration (SBA) in particular provides loans that take into account systemic prejudice and challenges that women face in the business world.
There has been a lot of talk lately about the government’s stimulus package for small businesses. This will hopefully help a lot of female entrepreneurs keep their businesses going. But while the SBA is helping to manage the rollout of this package, they are not doing so at the expense of their regular loans.
The SBA is the lender you can trust most to make it out of this crisis. After all, it is funded by the government and responsible for the continued stability of the small business economy.
Private lenders
That said, COVID-19 will probably not destroy your chances of securing private loans. On the contrary, many lenders will see the potential for profit from investing in the regrowth of small businesses.
The greater risk is that private lenders may not be capable of supporting all the small businesses struggling to make it through the COVID-19. The good news is that it is in the best interests of the economy as a whole for the government to ensure lenders are taken care of. The economy would fall apart without continued credit opportunities on a scale close to what existed before the country shut down.
Wait and see?
The question you will need to answer in the short term is whether you are going to push forward with your business plans, even as the system teeters on uncertainty or whether it is a better idea to wait and see what happens. Your choice will depend on how far along you are in the process of getting your business up-and-running, whether you are already bringing in revenue, and how much capital you have available for the immediate future.
In terms of small business loans, you can still apply right now from the SBA and private companies, as well as applying for help from the government stimulus package. Weigh up all your options, but remember there is no right answer in these times. You should also research to find allies like EP Wealth who have an “investing in women” initiative. Aligning yourself with companies and individuals looking to help women specifically can help tremendously during these times.
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