DEFINITION of 'Emergency Credit'

A loan given by a federal reserve bank to a non-bank institution or organization when no other source of credit is available. The organization in need must examine all other potential sources of funds first. Most of these loans are longer-term, usually more than 30 days.

BREAKING DOWN 'Emergency Credit'

The Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) amended the Federal Reserve Act to expand the scope of bailouts for federally-insured depository institutions.

RELATED TERMS
  1. Nonbank Banks

    Financial institutions that are not considered full-scale banks ...
  2. Cost Of Funds

    The interest rate paid by financial institutions for the funds ...
  3. Reserve Ratio

    The portion (expressed as a percent) of depositors' balances ...
  4. Loan

    The act of giving money, property or other material goods to ...
  5. Commercial Loan

    A debt-based funding arrangement that a business can set up with ...
  6. Building And Loan Associaiton

    It is a depository financial institution that is federally or ...
Related Articles
  1. Tech

    Can the Banking Industry Defend Itself Against Alternative Lending?

    If it learns to embrace fintech like its non-bank competitors have done.
  2. Personal Finance

    Different Needs, Different Loans

    Find out what options are available when it comes to borrowing money.
  3. Investing

    Nonbanks Overtake Banks as Top Mortgage Issuers

    As banks retreat from lending to more risky borrowers, nonbanks have stepped in and now make up the bulk of all mortgage issuance.
  4. Personal Finance

    College Loans: Private vs. Federal

    Not all student loans are the same. Know what you're getting into before signing on the dotted line.
  5. Financial Advisor

    The Best Way To Borrow

    There are many avenues from which to drum up funding. Find out the pros and cons of each.
  6. Personal Finance

    What's the Federal Funds Rate?

    The federal funds rate is the interest rate banks charge each other for overnight loans to meet their reserve requirements.
  7. Personal Finance

    Have Bad Credit? 6 Ways to a Personal Loan Anyway

    It'll cost you more, but borrowing is definitely doable. Here's how to proceed.
  8. Managing Wealth

    When Are Personal Loans a Good Idea?

    You never want to borrow money for frivolous reasons, but these five circumstances might warrant it.
  9. Personal Finance

    Understanding Loans

    A loan is the act of giving money, property or other material goods to another party with the expectation of being repaid.
RELATED FAQS
  1. What do banks do to control the bank reserve?

    Understand what the Federal Reserve does in order to expand or contract the economy. Learn what depository institutions can ... Read Answer >>
  2. Student loans, federal and private: what's the difference?

    Learn about the differences between federal and private student loans, and discover the types of federal funding available ... Read Answer >>
  3. What are the typical requirements to qualify for closed end credit?

    Learn what closed-end credit is, and the various requirements that borrowers must meet in order to obtain a closed-end credit ... Read Answer >>
  4. How does the Federal Reserve determine the discount rate?

    Learn about the several different kind of discount rates offered to banks and other depository institutions through the Federal ... Read Answer >>
  5. Federal student loan rates: who sets them, why they vary

    Federal student loan rates are set by Congress, not by banks. Learn more about who gets what rate, and how often they get ... Read Answer >>
  6. Are Sallie Mae loans considered federal loans?

    Identify the differences between federal and private student loans, explore the qualities of each type of loan, and find ... Read Answer >>
Trading Center