Have you received state or local support to help get your business through the Covid-19 disruption? If not, you are not alone. 86% of small business owners say they have not received state or local aid, despite such aid is available to them.
This was the finding of a new report by Fundera, providers of financial resources for small businesses. The survey explored how much funding small businesses have received this year.
2020 has been an incredibly difficult year for small businesses. Government support such as the Paycheck Protection Program, have been a lifeline to many small businesses struggling to stay afloat.
Despite the lifeline, more than 86% of the survey’s recipients say they have not received any small business grants, rent relief, or payroll relief.
Lack of State and Local COVID Aid for Small Businesses
Fundera’s report delved into the reasons why so many small businesses have not been capitalizing on the financial assistance available to them.
The reasons why small businesses have not been taking aid is not because support isn’t available. In the District of Columbia, for example, 24 states have financial aid programs running for small businesses.
When asked why they didn’t receive financial support from the government, 23% of small businesses said the terms of aid were unclear. 21% say they were not interested in getting in the debt that would result from the support packages. Almost 13% of the small businesses surveyed cited a “distrust of government-backed financial programs.”
Being Left Out by Local Governments
Regardless of whether they received financial aid or not, most small businesses feel their local governments have neglected them. As one small business owner cited in the report said:
“I would love a grant or loan, but the only options my state gave were for brick-and-mortar businesses. They wouldn’t even consider mobile or online businesses.”
Out of the businesses which accepted support, more than half received a grant and approximately a third accepted a loan. Almost 8% benefited from rent relief and over 5% from tax relief.
The findings of Fundera’s survey reiterate the importance of small businesses remaining up-to-date with the financial support available to them. It also confirms the need for local governments to consider revamping existing aid programs to make them more small business-friendly.