New 36.8 Trillion KRW Funding Supplied to SMEs and Small Business Owners During Lunar New Year Holiday

Automatic Extension of Maturing Loans to the 3rd of Next Month

[Asia Economy Reporter Jin-ho Kim] Ahead of the Lunar New Year holiday, the financial sector will supply 36.8 trillion won in new funds to support small business owners and small and medium-sized enterprises (SMEs) struggling due to COVID-19.

The Financial Services Commission announced on the 23rd that it will implement the "Lunar New Year Holiday Financial Support Plan" based on this content.

First, policy financial institutions will provide 4.5 trillion won in new loans and guarantees to small business owners and SMEs. The banking sector will supply 32.3 trillion won in new loans. Support from policy financial institutions can be applied for through special fund support consultations at branches of the Korea Development Bank, Industrial Bank of Korea, and Korea Credit Guarantee Fund, while new bank loans can be consulted and applied for at each bank branch.

The maturity of existing loans and guarantees from policy financial institutions (8.4 trillion won) and existing bank loans (43.6 trillion won) will also be extended.

Additionally, a super-low interest loan program called "Hope Loan Plus," worth 10 trillion won, will be supplied to support the recovery of small business owners affected by strengthened social distancing measures. These small business owners can receive up to 10 million won (per representative) at a super-low interest rate of 1 to 1.5%, depending on their credit rating.

Small business owners with a NICE credit score of 745 or higher, classified as medium to high credit, can apply non-face-to-face via bank apps starting from the 24th. To distribute simultaneous access, for the first three weeks of applications, a five-day rotation system based on the last digit of the representative's birth year will be operated. Applications and registrations for low-credit small business owners (credit score 745 or below) have been accepted since the 3rd through the Small Business Policy Fund website.

During the Lunar New Year holiday, small and medium-sized card merchants (annual sales between 500 million and 3 billion won) will receive card payment amounts incurred during the holiday by February 4th without separate application.

Furthermore, if loan maturity dates, credit card payment dates, or automatic utility bill payment dates fall during the holiday, the payment dates will be automatically postponed to after the holiday (February 3rd). Stock trading payments will also be deferred until after February 3rd. If housing pension or deposit payment dates coincide with the Lunar New Year holiday, payments will be made in advance before the holiday (January 28th).

In addition, to enable customers to conduct urgent financial transactions during the Lunar New Year holiday, three mobile branches (for deposits/withdrawals, new bill exchanges, etc.) will be operated at highway rest areas, and 14 flexible branches (for currency exchange, remittance, etc.) will be operated at airports and areas with a high concentration of foreign workers.