How Small Businesses Can Get Financial Relief and Assistance

Navigating the landscape of small business assistance can be daunting, especially if you’re already in a stressful situation. Maybe you’re coping with economic challenges or a disaster, like a pandemic or severe weather, that has negatively impacted your business. From federal initiatives to state-level programs, small business relief can come in many forms, including grants, tax credits, loans, and specialized assistance programs.

If you’re a small business owner impacted by an emergency or looking to stabilize and grow, understanding small business assistance options is the critical first step. This guide will break down the key federal and state resources available, how to qualify for small business relief, and how to apply for the support your business needs.

What is small business assistance and financial relief?

Small business relief and assistance options typically include government-backed resources designed to help entrepreneurs and small business owners weather financial challenges, recover from disasters, or foster growth. This support may include government grants for small businesses, low-interest loans, tax credits, as well as small business tax relief and debt relief programs at both the federal and state levels.

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Federal grants and programs

Note that federal loan programs change frequently, so it’s important to check for updated information on small business assistance regularly.

Economic Injury Disaster Loans

About the loans: The SBA Economic Injury Disaster Loan (EIDL) program provides long-term, low-interest loans to help small businesses and non-profits survive and recover from declared disasters. Crucially, these loans can cover operating expenses that a business would have been able to pay if the disaster had not occurred, such as:

• Working capital
• Fixed debts, like rent or mortgages
• Payroll
• Accounts payable
• Other bills your business cannot pay due to a disaster’s impact

The SBA typically activates EIDLs for specific physical disasters, including hurricanes, wildfires, or floods, or other economic injury declarations made by the SBA. If this is relevant for you and your business, consider applying for an EIDL.

SBA 7(a) Loans

About the loans: The 7(a) Loan Program, the SBA’s primary business loan program, provides loan guaranties to lenders so they can lend funds to small businesses for the following purposes:

• Acquiring, refinancing, or improving real estate and buildings
• Short- and long-term working capital
• Refinancing business debt
• Purchasing and installing machinery and equipment, including AI-related expenses
• Purchasing furniture, fixtures, and supplies
• Expenses related to changes of ownership (complete or partial)

The maximum 7(a) loan amount is $5 million. If your business qualifies for a 7(a) loan, your lender may also recommend you for an SBA 7(a) Working Capital Pilot (WCP) loan. If so, explore applying for an SBA 7(a) loan.

SBA Microloans

About the loans: The SBA Microloan Program provides small, short-term loans up to $50,000 through nonprofit lenders to help startups and growing small businesses with the following benefits:

• Capital access for businesses that may not qualify for traditional bank loans
• Smaller loan sizes (average $13,000) for specific needs like inventory or equipment
• Required business training and technical assistance from the local lender
• Community-focused lending, often aiding underserved entrepreneurs
• Business credit building for future financing opportunities

If your business has these needs, you may want to apply for an SBA microloan.

State small business relief

Navigating small business relief options can be challenging, but resources are available no matter where you live. Here is a state-by-state guide to key programs and resources available across the U.S.

Private grant programs

While SBA loans are a cornerstone of small business assistance, private grant programs offer a compelling alternative by providing capital that your business does not need to repay. These awards, typically funded by corporations, foundations, and nonprofit organizations, support specific demographics, industries, or business missions.

Here are a few notable national programs offering small business assistance to qualified entrepreneurs.

• Hello Alice Small Business Growth Fund: In partnership with various corporate sponsors, Hello Alice offers multiple rounds of grants throughout the year, often targeting specific groups such as Black, Latino, LGBTQ+, and veteran-owned businesses. Grants are typically $5,000 to$25,000 and include ongoing mentorship and resources.
• Amber Grant for Women: Founded by WomensNet, the Amber Grant awards at least $10,000 every month to a woman-owned business, with one monthly winner receiving an additional $25,000 at year’s end.
• Comcast RISE: This initiative provides marketing, technology, and capital support to small businesses owned by people of color, including women of color, in Comcast’s service areas. The program awards thousands of grants each year, offering either a $5,000 monetary grant or a package of technology and marketing services.

Private grants are typically highly competitive and often niche. Your success depends on carefully matching your business’s profile with a grant’s specific eligibility criteria, which could be your location, owner demographics, industry, or business stage.

You can search for grants for small businesses at https://www.grants.gov/. You can also search for funding opportunities through the U.S. Economic Development Administration.

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Square

If grants and other assistance resources aren’t enough to solve your cash flow challenges, Square Loans¹ offers a fast and flexible funding alternative designed specifically for small businesses that use the Square payment system. Loans from Square can directly address cash flow issues by providing capital to seize immediate opportunities or navigate unexpected expenses.

Eligible Square small business users can access loans within the Square platform. Square loans don’t rely on traditional credit scores and lengthy applications to determine your eligibility. Rather, eligibility is based on your business’s actual sales history through Square. If you pre-qualify, you can access and accept a fixed-fee loan offer directly from your online Square dashboard. Repayments are automatically deducted as a fixed percentage of your daily card sales through Square, which adjusts with your business’s cash flow.

Cash flow remains a formidable challenge for many small businesses, often placing consistent day-to-day pressures on operations. Often compounding the problem is the “cash flow gap”—the lag between paying for expenses like inventory and payroll and receiving customer payments, which the U.S. Chamber of Commerce reports can create significant monthly hurdles for growth and stability.

Using a cohesive ecosystem such as Square, which allows instant card payments, gets you faster access to your money to help close the cash flow gap. Integrating tools like Square Checking ensures funds are immediately accessible, with instant transfers available for a small fee.

How to Apply for Small Business Relief

To apply for small business relief, begin by identifying the specific relief program that best fits your situation, whether that’s SBA disaster loans, state-based grant programs, or private sector initiatives.

Next, visit the official website of the administering organization to verify your eligibility, which often includes criteria like business size, location, industry, and demonstrated financial impact.

Some of the essential documentation you’ll likely need to provide includes:

• Tax returns
• Financial statements
• Payroll records
• Your business EIN

Then complete the application carefully, either online or through a designated local partner like an SBDC or lender. Many experts advise applying as early as possible in the case of requesting disaster assistance, as funding is often limited.

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FAQs on small business assistance

What relief is available for small businesses right now?

Currently available small business relief primarily includes SBA disaster loans for declared disasters and various state, local, or private-sector government grant programs for small businesses. Widespread federal emergency grants and small business debt relief programs are not generally available.

How do I qualify for a small business grant?

You qualify by meeting specific eligibility criteria set by the grantor, which often include business size, industry, location, owner demographics, or a clear demonstration of need or impact.

Are small business grants taxable?

Yes, the IRS considers most small business grants taxable income, so you must report them on your business tax return, unless specifically exempted by law.

What is the difference between a loan and a relief program?

You must repay a loan with interest, while a small business relief program (such as a grant or forgivable loan) provides assistance that does not require full repayment if you meet its terms.