Korea Development Bank Doubles Loan Limits for Companies Affected by COVID-19

'Cheer Up Republic of Korea Special Operating Fund' Full Revamp
Expanded Support Limits per Company, Extended Support Period, Increased Interest Rate Benefits

[Asia Economy Reporter Kangwook Cho] The Korea Development Bank announced on the 27th that it has completely revamped the ‘Cheer Up Korea Special Operating Fund,’ a dedicated product for companies affected by the novel coronavirus infection (COVID-19), to strengthen financial support for affected companies.

This product was launched in the amount of 5 trillion won on March 24 as part of the government’s ‘COVID-19 Financial Market Stabilization Measures,’ which included expanding loans to small and medium-sized enterprises (SMEs) and mid-sized companies (totaling 21.2 trillion won).

While this product has provided timely liquidity to companies affected by COVID-19, as the prolonged pandemic continues to cause a real economy crisis, there have been calls for enhanced financial support to enable the swift normalization of affected companies’ management.

Accordingly, the Korea Development Bank decided to increase the support limit per company from 25 billion won to 50 billion won for SMEs, and from 50 billion won to 100 billion won for mid-sized companies.

Additionally, the funding support period was extended from within one year to within three years, and the interest rate discount was raised from a maximum of 0.6% to a maximum of 0.9%, significantly reducing the borrowing burden on affected companies.

Since the government announced the ‘Financial Sector Response Measures Related to the Novel Coronavirus’ on February 7, the Korea Development Bank has further expanded funding supply, focusing on companies affected by COVID-19, supplying a total of 68 trillion won up to September 23 this year (an increase of 18 trillion won compared to the same period last year).

An official from the Korea Development Bank emphasized, “We will continue to work closely with the government to overcome the real and financial sector crises caused by COVID-19.”