An extension to July 30 for the Federal Reserve’s Paycheck Protection Program Liquidity Facility (PPPLF) announced recently is aimed at giving financial institutions added processing time to pledge to the facility any PPP loans that were approved by the Small Business Administration through the PPP’s expiration June 30.
The PPPLF extends term credit to financial institutions making PPP loans, accepting the PPP loans as collateral and, in turn, helping ensure eligible institutions the liquidity needed to fund PPP loans. The PPP was created under the CARES Act to help ensure liquidity for lending to businesses amid the adverse financial impacts of the COVID-19 pandemic.
The Fed facility was scheduled to expire June 30, but the Fed received Treasury approval for the 30-day extension.