Fed’s Aid Program for Midsize Businesses Spent Only 3% of Its Total
- Final data show a mere 3% of potential $600 billion tapped
- Yellen said the program was ineffective at aiding companies
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The Federal Reserve’s Main Street Lending Program, which was designed to provide emergency support to mid-size U.S. companies during the pandemic, lent out a total $17.5 billion -- or just 3% of its potential capacity -- according to data released Tuesday by the central bank.
The program was maligned from the start: slow to get off the ground, it only opened to borrowers in July. In the six months through December, when the Fed bent to a Treasury Department mandate to close it, it showed the challenges in setting up a program to aid this sector of the economy -- companies larger than the typical small businesses that qualify for Paycheck Protection Program lending but not large enough to access capital markets.