Financial Services Commission: "Second Round Loans for Small Business Owners Should Be Equally Supported for Low-Credit Groups"

Son Byung-du, Vice Chairman of the Financial Services Commission

[Asia Economy Reporter Kim Hyo-jin] Sohn Byung-doo, Vice Chairman of the Financial Services Commission, urged the financial sector on the 20th to "actively participate so that the second financial support program for small business owners can be evenly provided to all credit ratings, especially the low-credit group."

At the Financial Risk Response Team meeting held via video conference that morning, Vice Chairman Sohn said, "There is a growing consensus on the need for active support for small business owners," emphasizing this point.

The Financial Services Commission assessed that since the program was revamped on the 23rd of last month by doubling the loan limit and allowing overlapping loans from the first and second rounds, the support performance has been on the rise.

According to the Financial Services Commission, the average daily loan amount under the second program increased from 7.4 billion KRW before the 23rd of last month to 75.3 billion KRW after the 23rd.

Vice Chairman Sohn stressed that as the prolonged COVID-19 pandemic has led to an increase in small business closures and suspensions, the importance of policies that can support their recovery is also growing.

He also expressed his intention to "review ways to create practical synergies by linking the small business recovery support programs promoted by each ministry."

Since November of last year, the Financial Services Commission has been providing combined support through the 'Self-Employed 123 Recovery Support' program, which includes debt adjustment, financial aid, and management consulting.

The Ministry of SMEs and Startups also operates programs such as re-challenge incentives for small business owners of closed stores, business closure consulting, store demolition support, and re-startup education.

Vice Chairman Sohn emphasized strengthening support for small and medium-sized enterprises (SMEs) as well. He said, "Although loan demand for SMEs is expected to increase in the fourth quarter of this year, there are concerns that banks' lending attitudes will become stricter," adding, "We ask the financial sector to participate more actively in supporting small and medium-sized enterprises and mid-sized companies."