Electric Programs >> Cushion of Credit

Cushion of Credit (Advance Payment) Account

In accordance with the provisions of Section 313 of the Rural Electrification Act of 1936 (RE Act), as amended, the Rural Utilities Service (RUS) established a cushion of credit program. Under this program, RUS borrowers may make voluntary deposits into a special cushion of credit account. A borrower’s cushion of credit account balance accrues interest to the borrower at a rate of 5 percent per annum. The amounts in the cushion of credit account (deposits and earned interest) can only be used to make scheduled payments on loans made or guaranteed under the RE Act.

If you have any questions concerning the cushion of credit program, please contact the Direct Loan and Grant Program at 314-457-4049.