Loan Guarantee Program for Government Shutdowns

ME BFI News & Notices

Published October 2nd, 2025

Detected March 18th, 2026

Summary

The State of Maine has launched a Government Shutdown Loan Guarantee Program, established by LD874, for eligible financial institutions. Administered by FAME, the program guarantees repayment of a portion of loans made to federal or state employees affected by government shutdowns, with an initial Guarantee Fund allocation of $250,000.

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What changed

The State of Maine, through the Finance Authority of Maine (FAME), has opened the Government Shutdown Loan Guarantee Program, created by LD874. This program is designed to support eligible banks and credit unions in providing interest-free loans to federal and state employees impacted by government shutdowns. FAME will administer a guarantee fund, initially allocated $250,000, which can cover up to 10% of an overall loan pool, ensuring repayment of the principal in case of borrower default.

Eligible financial institutions must apply to participate in the program. Once approved, they can issue these specialized loans during government shutdowns. Participating institutions can file claims with FAME for repayment of outstanding principal if a borrower defaults. This initiative aims to provide financial relief to affected employees and support the liquidity of financial institutions during periods of government closure.

What to do next

Review eligibility criteria for the Government Shutdown Loan Guarantee Program.
Apply to FAME for participation if eligible and interested in offering loans.
Familiarize with program terms and conditions for issuing interest-free loans during shutdowns.

Source document (simplified)

The Government Shutdown Loan Guarantee Program is now open for eligible financial institutions to participate

Oct 2, 2025

The Government Shutdown Loan Guarantee Program, created by LD874, establishes a guarantee fund administered by the Finance Authority of Maine. In partnership with the Bureau of Financial Institutions and the State Treasurer, FAME administers the program, guaranteeing repayment of a portion of loans made by eligible banks and credit unions to federal or state employees affected by government shutdowns. Financial institutions apply to participate and once approved, can issue interest-free loans during shutdowns in accordance with LD874. In the event of a default, participating institutions may file a claim with FAME for repayment of the outstanding principal. The Guarantee Fund received an initial allocation of $250,000 and can support up to 10% of an overall loan pool. For more information, please contact support@famemaine.com or visit: https://www.famemaine.com/government-shutdown-loan-guarantee-program/.