The Fed's expanded lending looks to help fill the holes PPP missed

While business owners have largely praised the federal government's fast response and the good intent of the CARES Act, it has left much to be desired.

The state of play: It is believed that one of the reasons for the Fed's expanded lending under the Main Street facility is the struggles of the Paycheck Protection Program.

What it means: With the Small Business Administration overwhelmed by demand and many small business owners unable to access funding, PPP has been plagued by bad news since even before it launched.

Where it stands: "PPP was the right idea but it was intended to be a short-term measure and really needs structural changes that can, in addition to a major infusion of resources, give travel businesses and their workers a real chance to survive," Tori Barnes, executive VP of public affairs and policy at the U.S. Travel Association, said during a media briefing Thursday.

• "There are many businesses with no customers, with no revenues that are left out altogether of PPP and the CARES Act."

Between the lines: By reducing the size of the loans it offers (which unlike PPP loans cannot be forgiven), the Fed's Main Street program allows medium-sized businesses direct access to its seemingly bottomless supply of cheap capital through financial institutions that take on, at most, 15% of the risk while the central bank shoulders the rest.

• "By lowering the minimum loan size you’re going to be able to reach a lot of companies that would’ve been in that PPP range," Amanda Fischer, policy director for the Washington Center for Equitable Growth, tells Axios.
• "$500,000 is still bigger than the average PPP loan recipient, but this isn’t Wall Street levels of money."

Of note: The Fed also is buying PPP loans to clear them from bank balance sheets and allow more lending.

Go deeper: How many big companies got PPP loans