Lawmakers on a top banking panel largely agree that the Federal Reserve’s Main Street lending program has fallen short. But they’re debating whether or how to change the rules and allow the Fed to make more, albeit riskier, loans to struggling businesses.

At a Senate Banking Committee hearing on Wednesday, policymakers differed over whether the Main Street program can be strengthened with a new structure and relaxed loan terms, or if more direct aid from Congress is needed to help companies fighting for survival during the pandemic.

As of last Thursday, the Main Street lending program had completed $1.2 billion in loans, just a fraction of the $600 billion pot.

“I am still concerned that incorporating widespread restrictions in these facilities could render the facilities ineffective and leave businesses and their employees without critical resources they desperately need,” said Sen. Mike Crapo (R-Idaho), chairman of the Banking Committee.

The program could have wider reach if the Fed bought 100 percent of all Main Street loans from banks, instead of 95 percent, according to Jeffrey D. DeBoer, president of the Real Estate Roundtable, and Hal S. Scott, president of the Committee on Capital Markets Regulation, who testified at the hearing. Since the current structure leaves banks with some skin in the game, many lenders have shied away from making riskier deals. DeBoer and Scott also recommended that companies should be given a longer timeline before having to pay back the loans.

“The current approach has been tried and found wanting,” Scott said.

Lawmakers also highlighted trouble in the commercial real estate industry, which has taken a beating from lockdown measures and rent deferrals. The Main Street program’s restrictive terms have made it hard for commercial real estate companies to get help, DeBoer said, which has rippling consequences for the broader economy, from jobs to housing to state and local taxes.

A core issue is how much risk the Fed and Treasury Department can take under the Cares Act, since any losses are ultimately covered by taxpayers. In an interview last week, Eric Rosengren, president of the Federal Reserve Bank of Boston, said that is “completely appropriate” to want to limit the amount of risk to protect taxpayer dollars. But any number of rules on the terms sheet could be relaxed to expand the program’s reach, Rosengren said.

“It’s important for Congress to make clear how much risk they want,” Rosengren told The Post last week. “Right now, it’s easy to say, ‘We want lots of loans.’ But a year and a half from now, people are going to want to know why those loans went bad.”

Still, the number of loans covered by the Fed continues to rise each week. As of Aug. 31, 118 loans had been bought by the Fed, with businesses in construction, real estate, arts and entertainment, and manufacturing making up some of the largest shares.

At Wednesday’s hearing, Sen. Patrick J. Toomey (R-Pa.) said it is “still too soon to call this program a failure" and that it was “entirely possible” that needy businesses are accessing credit elsewhere. Toomey said that making the Fed buy 100 percent of a Main Street loan, instead of 95 percent, posed “an obvious challenge.”

The current structure is “meant to create an incentive for the banks to do proper underwriting so that there is some limit to the amount of risk that is being taken here,” Toomey said. “The idea was never to lend money to fundamentally insolvent businesses."

No matter the future of the Main Street program, there’s little expectation that the Fed can heal the economy alone. The Fed can only provide loans, and many businesses can’t afford to go into more debt through the Main Street program.

Yet Congress is still divided over another round of stimulus. During the hearing, Democrats pushed for another bill that would include enhanced unemployment benefits and aid to state and local governments. Republican committee members focused largely on the Main Street program, and Sen. John Neely Kennedy (R-La.) raised questions about how to reduce the government’s debt.

“We are going about this backwards,” said Sen. Sherrod Brown (D-Ohio), the top Democrat on the banking panel. “Every dollar we give to working families goes directly to supporting the real economy."

Jeff Stein contributed to this report.