With the lifting of quarantine measures aimed at curbing the spread of the COVID-19 pandemic, the United States ran into another acute problem - lending to a number of companies. The US Federal Reserve has provided invaluable assistance in this matter. On Monday, June 15, the regulator announced the launch of the Main Street program to support lending to small and medium-sized businesses. According to analysts, the program is one of the most complex lending schemes initiated by the Federal Reserve.

Experts believe that the current initiative is an important step taken by the regulator to help the American economy to recover. The Fed’s new program is designed for companies with up to 15,000 employees or revenue equal to less than $5 billion. Under this scheme, banks can provide up to $600 billion of lending to firms.

The Main Street Lending Program will be administered by the Federal Reserve Bank of Boston. The purpose of the lending scheme is to provide a direct incentive for large companies that cannot participate in the Paycheck Protection Program (PPP) which is intended to benefit small businesses with fewer than 500 employees.

The American regulator has been developing and launching Main Street for almost three months. The Fed had to make adjustments twice in order to give the majority of companies access to the program. The main difference between Main Street and the Paycheck Protection Program is that loans given to the firms are not gratuitous and they will have to be repaid. Nevertheless, the regulator can write off the debt  that small businesses owe to the bank turning the loans into grants, while large firms will not obtain such privileges.