The Federal Reserve Sept. 4 said that its Main Street Lending Program is now fully operational and accepting submissions of eligible loans to nonprofit organizations.
The program is designed to help small- and medium-sized for-profit businesses’ and nonprofit organizations’ credit flow, particularly those that were in sound financial condition prior to the COVID-19 public health emergency.
Under the program, the Federal Reserve purchases 95% of each loan’s debt issued by eligible lenders, with the lender retaining the remaining 5%. Borrowers pay no interest until the loan’s second year and no principal until year three. The program requires lenders to evaluate borrowers’ financial condition and creditworthiness based on the terms of the Main Street program and the lenders’ own underwriting standards.
Applications should be submitted through the Main Street lender portal by registered eligible lenders.