Seocho-gu Expands Loan Support per Business from 50 Million KRW Last Year to 70 Million KRW
Supports Local Small Business Owners Regardless of Credit Rating and Subsidizes Interest to Lower Loan Barriers
[Asia Economy Reporter Park Jong-il] Seocho-gu (Mayor Jeon Seong-su) is providing low-interest loans called ‘Small Business Owners’ Super Speed Loan’ to small business owners facing management difficulties due to the recent economic crisis and rising loan interest rates.
The total support scale is 74 billion KRW, the largest among Seoul’s autonomous districts. Especially this year, the loan limit per business has been increased from 50 million KRW last year to a maximum of 70 million KRW.
The district supports loans to small business owners facing financial difficulties due to lack of collateral through a special guarantee business agreement with the Seoul Credit Guarantee Foundation and local banks (Shinhan, Woori, Hana). The contribution fund totals 5 billion KRW, including 4 billion KRW from the district and 1 billion KRW from banks (Shinhan 500 million KRW, Woori 300 million KRW, Hana 200 million KRW).
The ‘Small Business Owners’ Super Speed Loan’ by the district is characterized by support regardless of credit rating and simplified loan procedures. By visiting designated banks, applicants can complete the process from application to loan in a one-stop manner.
Additionally, the interest burden on small business owners’ loans has been reduced. The loan interest rate is applied by combining the 3-month variable rate of the Negotiable Certificate of Deposit (CD) rate and an additional rate of 1.7%. Among this, the district subsidizes from a minimum of 1.75% to a maximum of 2.75% depending on the fund. Loan applicants only need to pay interest after deducting up to 2.75% from the total interest. Repayment options include within 5 years with 1-year grace period and equal installments over 2 (3 or 4) years, lump-sum repayment at 2-year maturity, or 3-year equal installments after 2-year grace period, allowing applicants to choose their preferred method.
The district started accepting applications in person through five Shinhan Bank branches from the 16th. Applications can be submitted with the required district documents until funds are exhausted, and detailed information is available on the Seocho-gu Office website.
Since 2020, the district’s super speed loan support project, initiated to help small self-employed businesses in crisis due to COVID-19, has supported about 860 billion KRW to a total of 3,435 businesses until last year, providing vital assistance to small business owners struggling with management difficulties to overcome the risk of closure.
In addition, the district is preparing various funding support projects for small business owners. First, in March, it will implement the ‘Small and Medium Enterprise Development Fund Loan Support Project’ using the district’s SME development fund to provide low-interest loans to businesses. Also, through agreements with banks, the ‘Commercial Bank Cooperative Fund Interest Subsidy Project’ that subsidizes interest on loans is scheduled to be implemented in March.
Jeon Seong-su, Mayor of Seocho-gu, said, “I hope this project will alleviate the economic difficulties of small business owners who are going through hard times due to management difficulties and high interest rates, even if only a little.”
Yeongdeungpo-gu Provides 6 Billion KRW in Loans at 1.5% Low Interest Rate for SMEs and Small Business Owners This Year
Applications for 3 Billion KRW Loan Support in the First Half from Feb 27 to Mar 10, Small Business Owners Can Borrow up to 200 Million KRW
Will Serve as a Strong Support System with Various Policies to Revitalize Small Business Owners and the Local Economy
Yeongdeungpo-gu (Mayor Choi Ho-gwon) announced that it will provide 3 billion KRW in loans each for the first and second halves of the year to local small and medium-sized enterprises (SMEs), self-employed, and small business owners who are experiencing management difficulties due to high interest rates and high prices.
The district will accept applications for the first half loan support from February 27 to March 10.
The support targets are SMEs, small business owners, and self-employed persons within the district. However, those currently receiving loans and repaying them as of the loan support announcement date, as well as businesses in luxury, entertainment, nightlife, and vice industries, and sectors such as finance, insurance, real estate, and pensions are excluded.
The support amount is up to 200 million KRW per business for SMEs in manufacturing, knowledge industries, and information and communication industries, and small business owners; for other self-employed and small business owners, up to 50 million KRW with a 1-year grace period and 4 years of equal installment repayment at an interest rate of 1.5%.
Businesses wishing to apply should have a prior consultation at Woori Bank Yeongdeungpo-gu Office branch and Seoul Credit Guarantee Foundation Yeongdeungpo branch, then submit the required documents and apply in person at the Yeongdeungpo-gu Office Regional Economy Division from February 27 to March 10.
If there are many applicants, priority will be given to ▲businesses registered with a factory in the district ▲businesses registered in the district with factory registration in Seoul ▲companies residing in the Yeongdeungpo-gu SME Startup Support Center.
The district plans to decide on businesses and loan amounts in March after document submission and on-site investigation, and start loan support from April.
Detailed information can be found in the notices and announcements section on the district website.
Additionally, the district operates various programs to support local small business owners and revitalize the local economy, including the Yeongdeungpo Special Credit Guarantee System, Yellow Umbrella Hope Incentive, practical training to strengthen small business owners’ capabilities, ‘Sosanghan Online Store’ for online marketing, and ‘Live Commerce’ support for real-time broadcast sales.
Choi Ho-gwon, Mayor of Yeongdeungpo-gu, said, “I hope this SME development fund will help stabilize the management of SMEs and small business owners struggling due to the economic downturn. We will continue to implement various practical policies to be a reliable support for SMEs and small business owners.”
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