The Federal Reserve Board announced it will extend for a final time its Paycheck Protection Program Liquidity Facility (PPPLF) by an additional month to July 30. The extension is being made as an operational accommodation to allow additional processing time for banks, community development financial institutions, and other financial institutions to pledge to the facility any Paycheck Protection Program (PPP) loans approved by the Small Business Administration through the June 30 expiration of the PPP program.
The PPPLF extends term credit to financial institutions making PPP loans, accepting the PPP loans as collateral. The liquidity provided by the PPPLF bolsters the effectiveness of the PPP by helping eligible financial institutions fund PPP loans.
The PPPLF was established in April 2020 under the Board's 13(3) authority and the extension from June 30 to July 30, 2021, was approved by the Secretary of the Treasury.