Main Street Lending Program Details Released
The Federal Reserve has released more information on the Main Street Lending program.
In a press release, the Fed announced that it was expanding the scope and eligibility for the program through a series of measures to include a third loan option with increased risk-sharing by lenders for borrowers with greater leverage, lowering the minimum loan size for certain loans to $500,000, and expanding the pool of businesses eligible to borrow. In addition, a substantiveFrequently Asked Questions document was released along with updated term sheets.
Loans will now be eligible for businesses up to 15,000 employees and up to $5 billion in annual revenue. These loans have a 4-year maturation and are not eligible for forgiveness, unlike the Paycheck Protection Program (PPP).
The yet-to-be-released program is not without its critics, as the Wall Street Journal has criticizedcertain aspects of the program through its editorial page. It is still uncertain when the program will become operational.
AmericanHort will continue to monitor the development of the Main Street Lending Program.