In the months ahead, Main Street loans may prove a valuable resource for firms that were in sound financial condition prior to the pandemic. To bolster the effectiveness of the Small Business Administration’s PPP, on April 16, the Federal Reserve launched the Paycheck Protection Program Liquidity Facility.
The facility supplies liquidity to lenders backed by their PPP loans to small businesses and has the capacity to lend up to the full amount of the PPP. As of last week, the facility held over $ billion in outstanding term loans to participating financial institutions.