(Bloomberg) -- Federal Reserve Vice Chairman Randal Quarles said getting loans to mid-sized U.S. businesses through the central bank's newly created Main Street lending facility is two-to-three weeks away.
“We are putting together the mechanisms for that credit to be distributed through the banks,” Quarles, the Fed's vive chair for supervision, said Friday in a webcast discussion hosted by the University of Utah. “That's probably 2-3 weeks away, a couple weeks away.”
The Fed is building the Main Street lending facility in connection with funding from the Treasury Department that was provided in the more than $2 trillion stimulus packaged passed by Congress last month, to help stem the damage to businesses and households as the economy shuttered to stem the spread of the COVID-19 pandemic.
The central bank announced Thursday -- along with a slew of other programs designed to help provide loans to Americans -- that eligible borrowers are businesses with up to 10,000 employees or up to $2.5 billion in 2019 annual revenues. The credit will be lent through U.S. banks.
The Fed's statutes require it to lend to credit-worth companies, Quarles said, and the central bank is developing the process to do that through this program.
The Main Street lending facility is meant to compliment the Paycheck Protection Program that the federal government started to get loans to small businesses.
The Fed also announced this week that it will also provide support to that program. Those loans can convert to grants if the firms retain or rehire their workers. The PPP also took weeks to set up and has encountered barriers in getting loans out to people quickly.
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