The Federal Reserve Board has announced they will soon be expanding the Main Street Lending Program. The move to expand the programs will allow small and mid-size businesses to apply for loans through participating banks until September 30, 2020. The Treasury Department will invest $75 billion into the program.
The Fed’s move comes after many small and mid-size businesses were unable to take advantage of the problematic Payroll Protection Program. Both the PPP and the Main Street Lending Program are part of the CARES Act. The PPP was administered by the Small Business Administration, while the Main Street Lending Program is through the Federal Reserve.
The intent of expanding the program is to help small and mid-size businesses continue their operations during the COVID-19 pandemic. Qualifying businesses will have no more than 15,000 employees and 2019 revenues of $5 billion or less.
The Main Street Lending Program has three facilities available to businesses. All three facilities have a five-year maturity, principal payment deferral for up to two years, interest payment deferral for one year with a minimum loan amount of $500,000. Unlike the Payroll Protection Program loans, the Main Street loans are not forgivable.
For more information on $600 Billion Main Street Lending program, visit the Federal Reserve Main Street Lending Program.
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