The Paycheck Protection Program, a $349 billion small business lending program approved as part of last month's $2.3 trillion stimulus package in response to the COVID-19 pandemic, has run out of money, which is expected to jump-start talks in D.C. for a new round of funding.
More than 1.4 million loans had been approved by last night when the Small Business Administration, which is administering the program, announced it had run out of money.
U.S. Treasury Secretary Steven Mnuchin is expected to resume discussions with Congressional leaders on adding another $250 billion to the fund, with Treasury staff likely to meet today with counterparts from the offices of U.S. Senate Minority Leader Chuck Schumer and House Speaker Nancy Pelosi.
Some good news: The Federal Reserve’s backstop for the PPP program is up and running. The facility — which takes the loans banks make to small businesses as collateral — became fully operational as of today.
Banks that make loans are now able to essentially get financing from the Fed to extend that credit, by using the loans they are making as collateral."