Shinbo, Special Guarantee for COVID-19 Economic Recovery... 3.25 Trillion Won Supplied Over 2 Years

Support for Driving and Facility Funds... Increased Guarantee Ratio and Reduced Guarantee Fee Benefits

[Asia Economy Reporter Minwoo Lee] The Korea Credit Guarantee Fund (KODIT) will implement a special guarantee support program worth 3.25 trillion KRW to assist small business owners affected by the prolonged COVID-19 pandemic.

KODIT announced on the 25th that it will carry out the "COVID-19 Economic Recovery Special Guarantee." As part of the government's "Customized Financial Support for Self-Employed and Small Business Owners" policy, it will provide 3.25 trillion KRW over two years to small business owners affected by COVID-19 to prepare for post-pandemic recovery through facility investment and workforce expansion.

The support targets small business owners (small enterprises and medium enterprises with annual sales under 5 billion KRW) who suffered direct or indirect damage due to reduced domestic consumption and business restrictions during the COVID-19 period. The program will broadly support companies that received quarantine support funds or loss compensation, as well as those experiencing sales or operating profit declines due to the prolonged pandemic.

Working capital loans will be supported up to 300 million KRW, and facility funds will be provided within the required amount. Measures such as an increased guarantee ratio (raised to 90%), a reduced guarantee fee rate (discounted by 0.5%), relaxed screening criteria, and delegated approval authority will be applied to ensure rapid guarantee supply to affected companies.

Additionally, small business owners who receive specialized consulting services conducted by KODIT or the Small Enterprise and Market Service will be eligible for an additional 0.1 percentage point discount on guarantee fees.

A KODIT official stated, "We will continue to actively fulfill our role as a policy financial institution by providing various customized financial support programs that help resolve financial difficulties for small business owners and enable them to wisely overcome the damages caused by COVID-19."