Up to 5 Million Won for 385 Small Business Owners and Small Enterprises... 500,000 Won for Street Vendors

Ministry of SMEs and Startups Confirms 6.8 Trillion Won Supplementary Budget... Submitted to National Assembly on 4th
6.7 Trillion Won for Support Fund Plus... Minimizing Blind Spots
50,000 Won Support for Street Vendors... Separate 20 Billion Won Budget Allocated

Asia Economy DB= Photo by Honam Mun munonam@

[Asia Economy Reporter Kim Bo-kyung] The government will support 3.85 million small business owners and small enterprises through this year's supplementary budget project, 'Butimok Fund Plus.' The number of beneficiaries will increase, and blind spots will be reduced, with the budget size reaching approximately 6.7 trillion won.

The Ministry of SMEs and Startups announced on the 3rd that it has prepared a supplementary budget of 6.845 trillion won to support small business owners and small enterprises affected by COVID-19. The supplementary budget, confirmed at the Cabinet meeting the day before, is scheduled to be submitted to the National Assembly on the 4th.

This supplementary budget includes a Butimok Fund Plus budget of 6.735 trillion won, expanded from last year's Saehopeum Fund (3.3 trillion won) and Butimok Fund (4.1 trillion won).

The number of beneficiaries was set at 3.85 million, an increase of 1.05 million from the previous Butimok Fund's 2.8 million.

The support target for businesses subject to gathering bans and restrictions now includes small enterprises with five or more regular employees (an increase of 400,000), and the sales limit for general businesses was raised from 400 million won to 1 billion won (an increase of 240,000), reducing blind spots.

A new category called 'business crisis industries' was established for those whose average sales last year decreased by 20% or more compared to 2019. Industries such as travel, air passenger transport, film production and distribution, and intercity, city, and charter bus transportation are expected to benefit.

Equity was also enhanced by providing additional support to many one-person operated businesses.

Furthermore, the support types were subdivided from the previous three (prohibited, restricted, general) to five types according to the intensity of quarantine measures implemented this year and the level of damage by industry, and the support amount was increased from 1 to 3 million won to 1 to 5 million won.

However, unlike the Butimok Fund, Butimok Fund Plus plans to support only businesses with decreased sales last year compared to 2019, even if they are subject to business restrictions.

A separate budget of 20 billion won was allocated to support street vendors managed by local governments with 500,000 won per business, based on business registration under the Value-Added Tax Act.

Street vendors not managed by local governments or those having difficulty registering as businesses can receive support through the temporary livelihood support fund (Ministry of Health and Welfare) for vulnerable groups.

Through a startup fostering project in the non-face-to-face sector, business commercialization funds will be provided to 600 startup companies. Additionally, 90 billion won was allocated to create jobs by offering further incentives upon new employment creation.

The Ministry of SMEs and Startups plans to promote changes in fund operation plans and strengthen execution of the existing budget, including this year's main budget.

In particular, regarding loan projects, an additional 200 billion won of emergency management stabilization funds will be supplied to small and medium enterprises facing difficulties in financing.

Low-interest loans worth 700 billion won will be provided to small business owners and SMEs maintaining employment. For 16,000 youth-employed small business owners, 500 billion won in loans will be supplied with an interest rate incentive (-0.4 percentage points) if employment is maintained for one year.

Moreover, policy effects will be enhanced through early execution of Onnuri gift certificate issuance, market management vouchers, and innovative startup commercialization funds in the second quarter of this year.

Minister Kwon Chil-seung of the Ministry of SMEs and Startups stated, "We plan to mobilize all policy means to swiftly restore the business conditions of our small business owners and SMEs to pre-COVID levels and to achieve improvements and leaps in the business environment."