UPDATE 1-GE plans to use Fed facility next week

(Adds background, details on commercial paper market and Fed facility)

NEW YORK, Oct 23 (Reuters) - General Electric Co (GE.N) plans to use the Federal Reserve's new short-term funding facility when it is launched on Monday.

The U.S. conglomerate and its finance arm, General Electric Capital Corp, have registered as users of the facility, the company told its commercial paper customers.

GE, which is a large player in the commercial paper market, said in the note to customers on Thursday that it plans to use the facility to support its commercial paper investors who may need liquidity.

A spokesman from GE said the company continues to fund its commercial paper without disruption. "The facility is good for our customers and good for the market," he said in an e-mail.

The Fed's Commercial Paper Funding Facility will start funding purchases of highly rated, U.S. dollar-denominated, three-month, unsecured and asset-backed commercial paper from U.S. issuers.

The facility was announced last week as a means to boost the availability of credit for companies and households.

The U.S. commercial paper market, which companies use to finance daily operations, has dried up following the collapse of the U.S. housing market.

Federal Reserve data published on Thursday showed the market contracted to its lowest level in three-and-a-half years through the week ended Oct. 22. (Reporting by Elinor Comlay; Editing by Gary Hill, Bernard Orr)