Youth Small Business Owners Join Public and Private Sectors to Collaborate on 'Funding'

Agreement on Guarantee Services to Support Young Small Business Owners

The Ministry of SMEs and Startups announced on the 30th that it held a business agreement for the ‘Youth Small Business Support Agreement Guarantee’ at a cafe operated by young small business owners in Jung-gu, Seoul. The purpose of this business agreement is to support young small business owners and small enterprises under the age of 39 who are struggling with financing to achieve business success.

To this end, Shinhan Bank made a special contribution of 7 billion KRW for guarantee funds and 3.5 billion KRW for guarantee fees. The Korea Credit Guarantee Fund plans to support credit guarantees worth 105 billion KRW through 17 regional credit guarantee foundations using the contributed funds.

Oh Young-joo, Minister of SMEs and Startups (left), is greeting young small business owners on the 30th at Continuity in Jung-gu, Seoul.

In particular, this agreement guarantee will fully cover the guarantee fees for 5 years from Shinhan Bank to alleviate the financial burden on young small business owners and small enterprises. The Korea Credit Guarantee Fund will provide preferential support by increasing the guarantee ratio (85% → 100%) and reducing the guarantee fee rate (1.0% → 0.8%) compared to general guarantees. The ‘Youth Small Business Support Agreement Guarantee’ is scheduled to be implemented in May.

Before the business agreement, a roundtable meeting was held with young small business owners, Minister Oh Young-joo of the Ministry of SMEs and Startups, Shinhan Bank President Jung Sang-hyuk, Korea Credit Guarantee Fund Chairman Lee Sang-hoon, and Deputy Director Kwon Dae-soo of the Small Enterprise and Market Service to communicate about the difficulties and suggestions of young small business owners.

Kwon Oh-seong, CEO of Geumaeum, who is engaged in performance planning, requested the option to select the refinancing loan agreement date, and Deputy Director Kwon Dae-soo of the Small Enterprise and Market Service responded that they would improve the system to allow small business owners to choose the agreement date through consultations with banks handling refinancing loans.

Cheon Hwi-young, CEO of Continuity, who operates a cafe, suggested full support for small business owners in the food and beverage industry who are creating their own brands and guarantee support for small business owners in the early stages of start-up. Deputy Director Kwon replied that efforts are being made to nurture small business owners with creativity and entrepreneurial spirit into global brands like Starbucks or Momos Coffee, and Chairman Lee Sang-hoon of the Korea Credit Guarantee Fund said that regional credit guarantee foundations are operating various guarantee products according to growth stages and will continuously review guarantee operation plans that meet funding demands.

Minister Oh Young-joo said, “The Ministry of SMEs and Startups will continue to do its best to support policies that provide practical help to young small business owners,” and urged, “Shinhan Bank and the Korea Credit Guarantee Fund should actively collaborate to ensure the smooth execution of the Youth Small Business Support Agreement Guarantee.”