The U.S. Federal Reserve eased the terms of its 'Main Street' lending program on Monday, cutting the minimum loan size in half to $250,000 and lengthening the term by a year to encourage more businesses and banks to participate.
FILE PHOTO: A man rides a motorized skateboard on a nearly deserted Church Street in the financial district of lower Manhattan during the outbreak of the coronavirus disease in New York City, New York, U.S., April 3, 2020. REUTERS/Mike Segar
The central bank also said registration for the program will begin soon and that lenders will be able to start making the loans to small and medium-sized businesses shortly thereafter. “Supporting small and mid-sized businesses so they are ready to reopen and rehire workers will help foster a broad-based economic recovery,” Federal Reserve Chair Jerome Powell said in a statement.
The new borrowing minimum may still not be low enough as some businesses need loans smaller than $250,000, Jill Castilla, president and CEO of Citizens Bank of Edmond in Oklahoma said on Twitter after the Fed announced the changes.
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