[Asia Economy Reporter Kim Hyo-jin] The second emergency loan worth 10 trillion won for small business owners affected by the novel coronavirus infection (COVID-19) can be applied for at all branches of seven banks starting from the 18th. Among these, five banks also accept applications online.
The Financial Services Commission explained this on the 15th through the 'Key QA on the 2nd Financial Support Loan for Small Business Owners' document.
The second loan is handled by seven banks: Kookmin, Nonghyup, Shinhan, Woori, Hana, Industrial Bank of Korea, and Daegu Bank. Applications can be submitted at all branches nationwide of these banks, and five banks?Kookmin, Nonghyup, Shinhan, Woori, and Hana?also accept applications through their internet websites.
Due to system construction circumstances, Industrial Bank of Korea and Daegu Bank are expected to start accepting online applications from mid-next month.
The Financial Services Commission urged applicants to visit their existing banks for application, as applying through the bank they have been using may be advantageous in terms of credit evaluation and interest rates.
Although applications start on the 18th, related review procedures will begin a week later on the 25th. Therefore, the Financial Services Commission expects that funds can be received sequentially from the end of this month at the earliest.
The loan interest rate is in the 3-4% range and may vary depending on the credit rating. The loan limit is 10 million won per case, with a maturity of 5 years (2 years grace period, 3 years installment repayment).
All small business owners struggling due to COVID-19 are eligible. However, if they have already used one of the currently offered loans such as the secondary interest subsidy loan by commercial banks, the ultra-low interest loan by Industrial Bank of Korea, or the management stabilization fund by the Small Enterprise and Market Service, they cannot receive this second loan.
Those who have overdue national or local taxes or delinquent existing debts are also ineligible for the loan.
The second loan is structured so that the Korea Credit Guarantee Fund guarantees 95% of the total loan amount. The handling banks conduct both loan screening and guarantee screening simultaneously.
When applying for the loan, six documents are required: business registration certificate, VAT taxable standard certificate, national and local tax payment certificates, real estate registry or lease contract, income amount certificate, among others.
In addition to the seven banks, Busan, Gyeongnam, Gwangju, Jeonbuk, and Jeju Banks will also handle the second loan starting from mid-next month.
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