Main Street Lending Program

The Main Street Lending Program was created by the Federal Reserve to provide support to small and medium-sized businesses and their employees experiencing financial strain due to the COVID-19 pandemic. This lending program is intended to help companies that were in sound financial condition prior to the onset of the COVID-19 pandemic maintain their operations and payroll until conditions normalize. Unlike Paycheck Protection Program (PPP) loans, Main Street loans are not forgivable. Businesses that have a PPP loan are not excluded from eligibility. 

Main Street offers three different loan categories: New Loan Facility, Priority Loan Facility and Expanded Loan Facility.  Available until December 31, 2020, these three loan categories use the same eligible borrower criteria and have many of the same features, including the same maturity, interest rate, deferral of principal and interest for one year, and ability of the borrower to prepay without penalty.  The loans are made through banks such as Banner Bank and other financial institutions.

Here’s a general overview of the three categories of Main Street loans:  

• Companies with up to 15,000 employees or revenues of less than $5 billion
• New loans $100,000 to $200 million   
• 4-year term (amortization varies by option; principal and interest payments deferred the first year) 
• Companies must commit to make reasonable efforts to maintain payroll and retain workers and must follow compensation, stock repurchase, and dividend restrictions that apply to CARES Act direct loan programs.

Beyond this list, the features and terms of the three loans differ and are suited for different situations. If you’re interested in learning more; we’re here to help.