Gangwon-do Provides 15 Billion KRW Loan Support for Food Service and Wholesale/Retail Businesses

Closure Rates Increasing Due to Consumption Contraction and Delayed Domestic Recovery
Up to 30 Million KRW per Business Registered Over 6 Months in Gangwon-do

The Gangwon Special Self-Governing Province (Governor Kim Jin-tae) announced on the 3rd that it has been implementing the ‘Buttress Special Fund’ support project since the 2nd to provide funds to small business owners engaged in the food service and wholesale/retail industries, where the closure rate has recently been increasing.

A view of the Gangwon Provincial Government Building. Photo by Gangwon Provincial Government

According to the ‘Gangwon Economy Memo’ released by the Bank of Korea Gangwon Headquarters on the 21st of last month, the closure rate of small business owners in the province has been rising since last year, and this year, the closure rate of restaurants and retail businesses is expected to be the highest since 2015.

Based on statistics from the National Tax Service and the Bank of Korea, the specific figures show that the closure rate of individual business owners in Gangwon Province was 9.5% in 2021, increasing to 9.8% in 2023. Looking at closure rates by industry, the food service industry rose from 13.3% in 2021 to 15.7% in 2023, and the retail industry increased from 13.2% in 2021 to 16.7% in 2023.

Gangwon Province has been preparing funding support measures targeting the food service and wholesale/retail sectors, which have been hit hardest due to consumption contraction and delayed domestic demand recovery, while closely monitoring various economic indicators.

It is expected that this targeted support through the Buttress Special Fund will alleviate the management difficulties of these industries with high closure rates.

This funding support project targets small and medium-sized enterprises and small business owners engaged in the food service and wholesale/retail industries who have registered their business in Gangwon Province, have been in operation for more than six months, and have a KCB credit score of 780 or higher. The total funding scale is 15 billion KRW, with a maximum support limit of 30 million KRW per business.

Applications can be made using a one-stop service when visiting banks, and non-face-to-face applications are also possible through the Gangwon Credit Guarantee Foundation’s ‘Bojeung Dream’ platform.

Meanwhile, Gangwon Province has been operating the ‘Hope Companion 1.2.3 Fund’ since July through agreements with banks, continuously supporting the alleviation of management difficulties for SMEs and small business owners through customized support such as policy fund refinancing loans and ‘removing barriers’ for low-credit individuals.

To reduce the burden on businesses that have reached the closure stage and must repay loan principals in a lump sum, a ‘Bridge Guarantee Support’ that converts business guarantees into personal guarantees is also being prepared and is currently under budget review.

Governor Kim Jin-tae of Gangwon Province stated, “The food service and wholesale/retail industries account for about 37% of small business owners in the province and are closely related to the lives of residents,” adding, “We hope that this Buttress Special Fund support project will ease the management difficulties of these industries and allow everyone to have a warm year-end.”