Small and medium sized businesses here could record a combined total shortfall in revenue this year of between €10.3bn and €11.7bn, according to a new analysis by the Central Bank of Ireland.
However, the bank says the estimates are subject to significant uncertainty because of the current economic and health situation and the inability of owners to know what lies ahead for them.
The paper, focusing on the finances of SMEs during the pandemic and the design of future support policies, claims the impact of Covid-19 on small firms here has been sudden, large and uneven.
It claims that because of their models, compared to larger corporates and ordinary households, these businesses are likely to face significant financial strain.
If finds that the assistance provided by the Government has offered a significant support to firms, but those facing the biggest difficulties will continue to grapple with major challenges.
Many of the firms may have a viable future in the medium term, but in order for them to survive assistance in the form of forbearance or restructuring may be needed.
Others, however, would have been unsustainable entering the pandemic – although picking out which ones fit this profile may be a challenge, the research suggests.
The paper says Government policy may therefore need to focus more than normal on protecting firms in the short-term because of that.
It also points to the negative wider knock-on impact of letting businesses fail on others in the economic ecosystem.
The authors argue that the revenue shortfalls, totalling up to €11.7bn this year, will have to be met by a mixture of cash reserves, borrowing, cost cutting and loss-sharing.
However, they also say that the Government can assist through grants into the businesses themselves, rather than to the wages of staff, as well as tax reliefs and loan guarantees.
Debt though may be avoided by many companies, the research says, because they are wary of taking on additional borrowing.
Because of the higher cost of providing grants, the authors say an option would be for the state to offer equity-like or "conditional grant" injections to SMEs.
These would involve an element of clawback or potential return.