Chungnam, Agricultural and Fisheries Rural Development Fund 'Annual Interest Below 1%' Low-Interest Loans

[Asia Economy (Hongseong) Reporter Jeong Il-woong] Chungnam Province has finalized its support plan for the Rural Development Fund this year and will provide loan support. The loans will be offered at a low interest rate of less than 1% per annum.

According to the province on the 19th, the core of this project is to provide low-interest loans to local farmers and fishermen who are facing difficulties due to the accelerated import liberalization of agricultural and marine products, aging population, low birthrate, and COVID-19.

The loan funds can be used for ▲general income crops and regional specialty development ▲distribution and processing businesses ▲export promotion projects, among others. The individual limit is up to 50 million KRW, and the corporate limit is set within 30% of total assets.

Facility funds can be borrowed under the conditions of a 2-year grace period followed by 3 years of equal repayments, and operating funds must be repaid in a lump sum within 2 years.

Earlier, in October last year, the province signed an agreement with the National Agricultural Cooperative Federation, NH Nonghyup Bank, and KEB Hana Bank to fix the interest rate at 3.03% (fixed additional 2.4% + variable CD 0.63%). At that time, the province subsidized 2.4% of the interest, so the actual interest burden for farmers (businesses) is 0.66% based on the current benchmark rate as of January.

Farmers or corporations wishing to apply for fund loans should prepare a project application and submit it to the agricultural department of their city or county. The final support recipients will be determined after local city/county-level reviews and the provincial department’s assessment of project feasibility.

Jeong Nak-chun, Director of the Provincial Department of Agriculture, Forestry and Livestock, said, “We hope that the Rural Development Fund loan support can be of some help to local farmers and fishermen who are struggling with labor shortages and market development due to COVID-19 and other challenges.”