Gwangju City Provides 40 Billion KRW Business Fund Loans to Small Business Owners

3-4% Loan Interest Support for 1 Year... Up to 30 Million KRW Loan

Agreement with 9 Financial Institutions... Operates from the 12th Until Limits Are Exhausted

Gwangju Metropolitan City (Mayor Kang Gi-jung) announced on the 11th that it will provide 40 billion KRW in operating funds loans in the second half of the year to alleviate financial difficulties faced by small business owners and self-employed individuals experiencing management crises.

Gwangju City is providing a total of 140 billion KRW in operating stabilization funds loans this year, including issuing 100 billion KRW in special guarantees for neighborhood commercial district operating funds in the first half of the year.

The 40 billion KRW special guarantee for the second half will be funded with 2.7 billion KRW contributed by Gwangju City, fully guaranteed by the Gwangju Credit Guarantee Foundation, and loan support will be provided by contracted financial institutions.

The contracted financial institutions include nine organizations: Gwangju Bank, Kookmin Bank, NH Nonghyup Bank, Shinhan Bank, Woori Bank, Hana Bank, Saemaeul Geumgo Central Association, Credit Union Central Association, and Nonghyup Central Association.

Additionally, Gwangju City will invest a total of approximately 4.8 billion KRW this year to reduce the high-interest financial burden on small business owners by supporting 3% interest on loan interest rates for one year from the loan execution date. For those with medium to low credit scores, an additional 1% will be supported, totaling 4% interest support.

This special guarantee loan support for small business owners targets all industries of small enterprises, small business owners, and self-employed individuals located in Gwangju, excluding certain sectors such as entertainment, gambling, and speculative industries.

Loan conditions allow borrowing without collateral through screening and guarantees by the Gwangju Credit Guarantee Foundation. The loan interest rate is variable, either short-term KOFIX + 1.5~1.6% or CD rate (91 days) + 1.5~1.6%, and the guarantee fee is 0.7% per annum.

Small business owners with a credit score of 350 or higher can apply for loans at contracted banks with a maximum limit of 30 million KRW, choosing between a 1-year grace period with 2-year installment repayment or a 1-year grace period with 4-year installment repayment. The operation period for this special guarantee is from the 12th until the limit is exhausted.

Applicants wishing to apply for the special guarantee should make a consultation reservation through the Gwangju Credit Guarantee Foundation website and visit the corresponding branch on the reserved date.

Joo Jae-hee, Director of the Economic Startup Bureau, stated, “We expect that providing operating fund loans and interest support to small business owners and self-employed individuals struggling due to high inflation, high interest rates, and economic recession will contribute to overcoming their management crises.”

Meanwhile, Gwangju City is supporting the full interest (3.5~4.5%) for one year for financially vulnerable groups in the financial blind spots who find it difficult to access institutional loans this year. This support is provided to users of ‘Miso Finance’ (for startup, operation, facility improvement funds, etc.) through the Korea Inclusive Finance Agency’s Miso Finance Gwangju Buk-gu branch and users of the Credit Recovery Committee’s ‘Bitgoeul Loan.’