Small Business Lending during COVID-19

Beauregard, Remy; Lopez, Jose A.; Spiegel, Mark M.

Journal Article

Small Business Lending during COVID-19

Abstract: Small businesses and farms were hit hard by restrictions that limited their ability to pay operating costs during the COVID-19 crisis. Banks played an important supportive role, substantially expanding the loans available to these firms during the early months of the crisis. The growth in lending was associated with small business participation in the Paycheck Protection Program (PPP) and bank use of the PPP Liquidity Facility. Analyzing data for the first half of 2020 suggests that these programs were successful in supporting lending growth during the crisis, particularly among small banks.

Keywords: Covid-19; Small business;