The credit crunch brought about by the collapse of the U.S. housing market is spreading throughout the world and has begun choking off funding to small and midsize Japanese companies.

Fearing the squeeze will accelerate bankruptcies of smaller firms, especially in rural regions, the government has drafted a bill to give it the authority to use up to ¥2 trillion in public funds to bolster the capital of any Japanese bank.

The Cabinet submitted the bill Friday to the Diet and eyes passage by the end of the month. Here are questions and answers about the bill.