Disaster Relief Fund 1st Phase to be Paid on 28-29th... Subject to Supplementary Budget Approval on 22nd

Due to the resurgence of the novel coronavirus infection (COVID-19), Namdaemun Market in Jung-gu, Seoul is showing a quiet scene. Photo by Jin-Hyung Kang aymsdream@

[Asia Economy Reporter Lee Kwang-ho] Various support funds for small business owners and vulnerable employment groups such as special employment workers (teukgo) and freelancers who suffered damage from the resurgence of the novel coronavirus infection (COVID-19), as well as families with preschool children (infants and toddlers) and elementary school students, will be paid in the first round on the 28th and 29th. However, since the deadline for the first application is tight, it is expected that applying quickly will allow recipients to receive the support funds before Chuseok.

According to the Ministry of Economy and Finance, Ministry of Employment and Labor, Ministry of SMEs and Startups, and Ministry of Health and Welfare on the 20th, the government has tentatively set this payment schedule assuming that the 4th supplementary budget bill will pass the National Assembly on the 22nd.

The government plans to send notification messages to the recipients of various support funds around the time the 4th supplementary budget passes the National Assembly. Recipients only need to apply online without submitting separate supporting documents.

It is highly likely that online applicants will be collected around this weekend and the first payment will be made to them. In other words, applications must be submitted within the deadline specified in the notification message to receive the support funds before Chuseok.

For support funds with clear recipients and payment methods, payments may begin from the latter half of this week. However, since many cases require application, collection, and verification procedures, most funds are realistically expected to be disbursed on the 28th and 29th, just before Chuseok.

Given the current situation, the support funds that can be disbursed at the fastest speed are the care support funds for infants and elementary school students and the Sae Hope Fund for small business owners.

For the Sae Hope Fund, which provides 1 million to 2 million KRW to small business owners affected by the COVID-19 resurgence, funds will be disbursed to most recipients on the 28th. Those eligible for payment before Chuseok are business owners whose sales decrease can be confirmed through government administrative information and small business owners identified as belonging to special damage industries.

For general taxpayers, the government can pre-select sales decrease through administrative information, and for simplified taxpayers, the plan is to provide support first and recover funds later if evidence is not submitted, so the payment date is unified as the 28th.

Small business owners in industries subject to gathering bans or restrictions can also be selected after confirmation by local governments, so the government expects most payments to be completed before Chuseok.

The government plans to provide 1 million KRW to small business owners with annual sales of 400 million KRW or less who experienced sales decreases after the COVID-19 resurgence, and 1.5 million to 2 million KRW regardless of sales size or decrease to those in gathering-restricted or banned industries due to strengthened social distancing. The total number of eligible small business owners reaches 2.91 million.

The special care support fund (200,000 KRW per child) for families with preschool children and elementary school students is also expected to be mostly paid before Chuseok.

Since the recipients of the special care support fund are clear and the payment methods are already in place, the payment timing can be the fastest. However, the government currently only specifies the payment timing as "before Chuseok." The recipients include about 2.52 million preschool children and 2.8 million elementary school students.

For vulnerable employment groups such as special employment workers and freelancers, 500,000 people who previously received the first emergency employment stabilization fund are eligible for payment before Chuseok. They will receive 500,000 KRW each.

The government plans to select one day between the 24th and 29th to make a lump-sum deposit to applicants.