To access the SBLF, community banks must have assets less than $10 billion to borrow from the fund and use it for lending purposes. Advocates in the banking sector have said the program could spur $300 billion in lending.
During the economic downturn, business have struggled to get loans from banks reluctant to risk lending.
Earlier this month, Sens. Mary LandrieuMary LandrieuMedicaid rollback looms for GOP senators in 2020 Five unanswered questions after Trump's upset victory Pavlich: O’Keefe a true journalist MORE (D-La.), chairwoman of the Senate Committee on Small Business and Entrepreneurship, and George LeMieux (R-Fla.) sent a letter to Treasury Secretary Timothy Geithner requesting quick implementation of the fund.
Applications for the fund were first posted on Monday and the Office of the Comptroller of the Currency sent out a notice Tuesday to chief executives, lending officers at national banks and examining employees that the program was ready to go.
Under the program, SBLF funds carry a base dividend rate of 5 percent. Participants that increase their small-business lending will be able to lower and lock in their dividend rate to as low as 1 percent during the first two-year period, according to ICBA.
Community banks with less than $1 billion in assets will be eligible for investments of up to 5 percent of risk-weighted assets, and banks with between $1 billion and $10 billion in assets will be eligible for up to 3 percent.