WASHINGTON (Reuters) – U.S. Treasury Secretary Steven Mnuchin said on Tuesday that over 3,000 lenders were participating in a new $349 billion small-business coronavirus loan program, and that the Federal Reserve and Treasury were working to set up facilities to support “Main Street” and municipal borrowers.
“If you can’t get the loan today or tomorrow, don’t worry, there will be money,” Mnuchin told Fox Business Network, referring to the small business loans. “If we run out of money, we’ll go back for more.
“There’s extraordinary demand,” he said. “This is the third day that this program is up and running.”
Mnuchin said initial difficulties in launching the small business lending program were a function of banks being “overwhelmed” with demand for loans.
Mnuchin said the small business loans could be thought of as grants and were aimed at supporting about half of the U.S. workforce for about eight weeks during coronavirus shutdowns and quarantines.
The Treasury and the Fed hope to have the Main Street lending facilities “up and running quickly,” he said. That program will tap a pool of $454 billion in Treasury capital to support Fed lending to small and mid-market companies with up to 10,000 employees.
The same pool of capital also will support a Fed facility to support municipal bond markets that have largely seized up, denying cities, states, counties, school districts and hospital groups the ability to raise cash with new bond issues.
The Treasury will pursue $46 billion in direct lending to airlines and national security-linked firms under the $2.2 trillion coronavirus rescue bill passed in late March.
Discussions on the next phase of coronavirus economic stimulus have begun, but Mnuchin said his top priority was to get the existing funds deployed quickly into the economy.
“We have $6 trillion to put in the economy, we’re meeting with all the advisers on the airlines this week, we’re working very quickly on that,” Mnuchin told Fox Business. “So I can assure you, the president has instructed us to get this money into the economy fast.”
(Reporting by David Lawder and Doina Chiacu; Editing by Chizu Nomiyama and Jonathan Oatis)