The Main Street Lending Program was run by the Federal Reserve System (Fed) to support small- and medium-sized businesses and nonprofit employers impacted by the COVID-19 pandemic.
The program made available $600 billion in loan facilities to employers, who must have been in good financial standing prior to the onset of the COVID-19 crisis. To encourage banks to lend, the Fed bought 95% of new or existing loans to qualified employers, while the issuing bank kept 5% to discourage irresponsible lending. In exchange for the loan, employers must have made reasonable efforts to maintain payroll and retain workers. The Fed announced the Main Street Lending Program on April 9, 2020.
On Nov. 19, 2020, Treasury Secretary Steven Mnuchin said he would not reauthorize extending the Main Street Lending Program past Dec. 31, 2020. However, the Fed extended the program to Jan. 8, 2021, to process loans that were submitted on or before Dec. 14, 2020. The program ended on Jan. 8, 2021.
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