- Federal Reserve Board modifies Main Street Lending Program to improve credit access for nonprofits such as educational services, hospitals, and social service organizations
- New and expanded loan options available
- Loan conditions generally mirror those of for-profit organizations
On Friday, the Federal Reserve Board modified its Main Street Lending Program to expand access to credit for nonprofits such as educational services, hospitals, and social service organizations. Two nonprofit loan programs, for new and expanded loans, are available.
Nonprofits must have been in sound financial condition prior to the pandemic and a tax-exempt organization as described in section 501(c)(3) or 501(c)(19) of the Internal Revenue Code. In response to public comment, the Federal Reserve Board lowered the minimum employment threshold, eased the limit on donation-based funding, and adjusted several financial eligibility criteria.
Nonprofit loan terms generally mirror those offered to for-profit organizations through the Main Street Lending Program, including a five-year term, 5% interest rate, two-year deferral on principal repayment, and one-year deferral on interest payments.