commercial paper programs

A commercial paper program is a financial arrangement that allows large companies to raise short-term funding by issuing unsecured promissory notes called commercial paper. These notes typically have maturities of up to 270 days and are sold to investors like money market funds. Companies use this method to quickly access cash for operational needs, such as payroll or inventory, often at lower interest rates than other borrowing options. A committed program often involves a pre-arranged line of credit with a bank, providing assurance to investors of repayment.