As the world races to recover from the economic impact due to the pandemic, the US has launched a $10 billion aid to boost the small business in deprived and minority groups as an attempt to get its economy back in order.
According to the Wall Street Journal, the State Small Business Credit Initiative reintegrates a policy that was set following the 2007-2009 recession.
These funds are dedicated towards the regulation of income to states, territories, and tribal governments for applications imparting venture capital or pushing private banks to issue loans to small firms.
Initially, it’s going to allocate $1.5 billion for organizations owned by disadvantaged groups and another $500 million set for small businesses having less than 10 employees.
This has derived from the funds dedicated by the Congress as they have committed towards a budget planned to deprived corporations, as WSJ reported, mentioning the Treasury Department’s deputy assistant secretary of capital access, Adair Morse.
On the report of the initiative framework, these groups consist of racial minorities, rural groups, and veterans.
President Joe Biden’s economic plans have surfaced a plethora of disagreements in the white house, due to the expenditure allotted for things like healthcare, education, and climate change. While few Democratic allies have stated the need for showcasing more work on addressing issues on race inequality and wealth.
The funds come from a $1.9 trillion coronavirus relief package authorized by Congress in March. Disbursement is expected to begin in the first quarter of 2022, according to the Treasury Department. Within the Treasury Department’s restrictions, states and other grantees have the freedom to develop their program offers as they deem suitable.
The launch comes as other aspects of President Biden’s small-business agenda languish amid greater uncertainty about the fate of his healthcare, education, and climate-change spending plans.
The republicans however expressed their opinion of allotting a $10 billion assistance towards the small businesses as an unnecessary campaign, since they already have previous pandemic aid for small businesses,
These financial plans are slated to be allocated by the first three months of the year, meanwhile, the rest of the funds are to be used by the beneficiaries as they seem fit in accordance with their needs which of course should lie within the parameters of the Treasury Department.
With the pandemic hitting a blow on the economy, small businesses by now have suffered the most with many of them having to pull their shutters down permanently.
The inconsistency and unpredictability of the current economy have led to several landlords having to offer breaks to their tenants or forcing them to make the hard choice of losing them as they were facing huge losses and businesses shutting down rapidly.
Adding to the difficult situation, landlords in San Francisco, are seen to be coping with greater economic stress due to the vacancy tax introduced, making the situation miserable for landlords with commercial space empty for more than 182 days in a year.