Program Purpose and Overview
When the Obama Administration took office, credit markets were all but frozen, meaning that it was extremely difficult for consumers and businesses to get loans. Availability of credit is critical for small businesses to grow and for consumers to make home improvements, buy a new car, or send their children to college.
There was a time when most Americans relied on local community banks to provide this type of consumer lending. Today however, it relies on complex secondary markets, which had nearly ground to a halt in the fall of 2008. Therefore, the government took action to jumpstart these crucial markets.
Three programs were launched: the Public-Private Investment Program (PPIP), the SBA 7(a) Securities Purchase Program, and the Term Asset‐Backed Securities Loan Facility (TALF). Although the specific goals and implementation methods of each program differed, the overall goal of these three programs was the same—to restart the flow of credit to meet the critical needs of small businesses and consumers.