Yale School of Management

Posts by SME

Fed Expands Main Street Lending Program to Include Nonprofits

July 20, 2020
On July 17, the Federal Reserve expanded eligibility for the Main Street Lending Program (MSLP) to include nonprofit organizations such as educational institutions, hospitals, and social service organizations. The Fed will purchase 95% participations in loans to nonprofits under terms that are similar to terms it previously announced for for-profit companies, with additional criteria tailored to non-profit organizations. Continue reading “Fed Expands Main Street Lending Program to Include Nonprofits”

Paycheck Protection Program highlights numerous oversight concerns even as the SBA makes first disclosures

July 13, 2020
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, which passed on March 27, established the Paycheck Protection Program (PPP), the US government’s largest and most controversial program put in place to address the economic impacts of the COVID-19 virus. Since April 3,the PPP has issued nearly 4.9 million loans guaranteed by the Small Business Administration (SBA). As of June 30, banks and other private lenders have extended $521 billion in government-guaranteed, forgivable loans under the program. The government’s support measures have enjoyed popularity with taxpayers compared to those enacted during the Global Financial Crisis (GFC). However, the PPP has been under constant scrutiny from Congress and industry critics since implementation. In response to such criticism and changing economic conditions, both Congress and the SBA have repeatedly modified the program. Continue reading “Paycheck Protection Program highlights numerous oversight concerns even as the SBA makes first disclosures”

Countries Continue to Adopt and Update Credit Guarantee Schemes for Small Business Lending

June 29, 2020
In response to the COVID-19 pandemic, many countries quickly announced credit guarantee schemes to support lending to small and medium-sized enterprises (SMEs). Under a credit guarantee scheme, the government fully or partially guarantees the value of a loan to an SME, which minimizes the risk to the lender, incentivizing the lender to provide credit. According to recent data from the World Bank, 41 countries have launched 57 credit guarantee schemes for SMEs this year.  Continue reading “Countries Continue to Adopt and Update Credit Guarantee Schemes for Small Business Lending”

Japan Begins Capital Injections for Financial Institutions in Response to COVID-19

June 19, 2020
On June 13, the Japanese Diet passed an amendment to the Act on Special Measures for Strengthening Financial Functions (ASFF) extending the period of government capital injection to financial institutions from March 31, 2022 to March 31, 2026 and expanding the available public funds for the injection from ¥12 trillion to ¥15 trillion.  Continue reading “Japan Begins Capital Injections for Financial Institutions in Response to COVID-19”

Small Business Administration Announces Updates to Small Business Support Programs

June 18, 2020
The Small Business Administration (SBA) and Treasury recently released guidance related to the Paycheck Protection Program (PPP) to clarify that they will forgive loans to employers that are unable to rehire or maintain employment levels. The agencies also released a simplified forgiveness application. Continue reading “Small Business Administration Announces Updates to Small Business Support Programs”