Nam-gu, Gwangju Metropolitan City, is increasing the interest differential compensation rate for special guarantee loans compared to last year to ease the interest burden on local small business owners' financial loans, and is also expanding the total amount of special guarantee loans to provide financial benefits to more small business owners.
According to Nam-gu on the 29th, Nam-gu, Gwangju Bank, and Gwangju Credit Guarantee Foundation recently signed an agreement to resolve funding difficulties and stabilize management for small business owners, and will support a total of 3.53472 billion KRW including special guarantees, interest differentials, and guarantee fees for local small business owners this year.
There are two changes related to the small business special guarantee policy compared to last year.
First, the interest cost burden for local small business owners will be reduced. When receiving a special guarantee loan from financial institutions, interest occurs during the loan process, but the interest differential compensation rate supported by the district office for local small business owners has been raised from 4.0% last year to 4.5% this year.
Nam-gu will invest 151.2 million KRW of district funds this year to further support interest differential costs and reduce the economic burden on small business owners.
Along with this, the total amount of loans through special guarantees has also been significantly increased.
To this end, Nam-gu will contribute 180 million KRW to the Gwangju Credit Guarantee Foundation this year, and Gwangju Bank, which first participated in special guarantee support last year in cooperation with the district office, also contributed 100 million KRW.
According to the inter-agency agreement, the Gwangju Credit Guarantee Foundation supports 3.36 billion KRW to local small business owners, which is 12 times the contribution amount, representing a 10.7% increase from last year's total special guarantee loan amount of 3 billion KRW.
Last year, about 158 local small business owners received financial support, and with the total loan amount increasing by about 360 million KRW this year, the number of local small business owners benefiting from special guarantee support is expected to rise to about 180.
In addition, Nam-gu will invest 23.52 million KRW of district funds to support a guarantee fee of 0.7% incurred during the loan process.
A Nam-gu official stated, "With the increase in interest differential support and the expansion of the total amount of special guarantee loans, more local small business owners will be able to receive support benefits," and added, "We will do our best to promote the special guarantee support project to stabilize the management of local small business owners."
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