Lenders may now register for the Federal Reserve’s Main Street Lender Program, the Boston Fed announced today, adding that lenders “are encouraged to begin making Main Street program loans immediately.”
Last week, the Fed announced several adjustments to the MSLP intended to facilitate participation by more small and midsize businesses. Responding to calls by ABA and others to increase small business access to the program, the Fed lowered the minimum loan size for certain loans from $500,000 to $250,000. The Fed also increased the maximum loan size for each loan option under the MSLP, increasing the term for each loan option from four years to five years and extending the repayment period for all loans by delaying principal payments for two years instead of one.
In other MSLP news, the Fed requested comment on extending MSLP eligibility to nonprofit organizations. Loan terms under the proposed expansion would be the same as for MSLP loans to for-profit businesses. Under the Fed’s proposal, eligible 501(c)(3) and 501(c)(19) entities would have between 50 and 15,000 employees; meet financial thresholds based on operating performance, liquidity, and ability to repay debt; have been operational for at least five years; and hold endowments of no more than $3 billion. Comments are due by June 22.