Meeting of Financial Risk Response Team on the 11th
"Encouraging Expansion of Funding for New Industries"
[Asia Economy Reporter Kim Hyo-jin] Sohn Byung-doo, Vice Chairman of the Financial Services Commission, expressed on the 11th his expectation that "the New Deal Fund will provide new investment opportunities and vitality to the financial investment market and offer the public a chance for stable wealth accumulation."
Vice Chairman Sohn made these remarks at the Financial Risk Response Team meeting held at the Korea Federation of Banks in Jung-gu, Seoul, on the morning of the same day. The New Deal Fund is an infrastructure fund investing in social overhead capital (SOC) mentioned in New Deal projects, and it is being promoted to allow the general public to participate through public offerings.
He stated, "The government plans to encourage the expansion of funding supply to new industry sectors such as digital infrastructure, green, and bio by utilizing various means including the New Deal Fund involving private and financial participation, venture capital, and policy finance."
Vice Chairman Sohn added, "To support the Green New Deal, a pillar of the 'Korean New Deal,' we will establish a 'Green Finance Promotion TF' with the financial sector to establish an institutional foundation for green finance and create investment conditions."
He also mentioned that financial support will be actively implemented to promptly assist in recovery from damages caused by the monsoon and heavy rains.
Accordingly, financial authorities plan to provide repayment deferrals and maturity extensions for debts and guarantees of affected companies at policy financial institutions, expedite payment of disaster insurance claims, and support premium payment deferrals.
6-Month Loan Repayment Deferral
Debt Reduction of 60~70%
On the same day, financial authorities announced support measures including debt adjustment for victims of heavy rain damage and additional supply of low-interest loans for self-employed individuals.
If users of financial institution loans affected by this heavy rain find it difficult to repay their loans, they can apply for new debt adjustment or re-adjustment through the Credit Recovery Committee to receive debt reduction.
Once debt adjustment or re-adjustment is confirmed, a principal repayment deferral for six months will be immediately applied. Differential interest rate reductions, principal reductions, and installment repayments are also possible depending on the delinquency period.
For debts owed to the National Happiness Fund or Korea Asset Management Corporation (KAMCO), the principal of the debt can be reduced by 70% (National Happiness Fund) or 60% (KAMCO), respectively.
Furthermore, residents of special disaster areas or those operating businesses in these areas due to this flood damage can receive repayment deferrals and preferential benefits for new loans on existing loans from Microfinance or Traditional Market Merchants Associations.
Principal repayment on existing loans can be deferred for six months, loan limits can be increased up to 10 million KRW, and preferential interest rates will follow for Microfinance loans.
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