Commercial Banks Offer 'New Loans and Maturity Extensions' to SMEs and Small Business Owners Ahead of Lunar New Year Holiday

Hana, KB, and Shinhan Each Provide Special Fund Support Worth 15.1 Trillion Won

Commercial banks are rolling out a series of financial support measures, including new loans and maturity extensions, targeting small and medium-sized enterprises (SMEs) and small business owners facing cash flow difficulties ahead of the Lunar New Year holiday.

Yonhap News

According to the financial sector on the 7th, Hana Bank announced that it will provide a total of KRW 15.1 trillion in 'Special Lunar New Year Funds for SMEs' until February 14, including KRW 6.1 trillion in new loans and KRW 9 trillion in maturity extensions. In particular, it plans to offer an interest rate discount of up to 1.50 percentage points (P) to reduce the actual interest burden on individual business owners and SMEs.

A Hana Bank official said, "Through the operation of this special Lunar New Year fund, we plan to reduce the financial burden on SMEs and support the creation of a stable business environment," adding, "We will spare no effort in providing comprehensive support so that domestic companies can turn crises into opportunities."

Additionally, since the 1st of this month, Hana Bank has been implementing a special loan program worth KRW 300 billion, providing up to KRW 2 billion per company to SMEs and small business owners struggling with cash flow due to exchange rate fluctuations. Furthermore, it is supporting corporate liquidity through an interest rate support program for loans guaranteed by the Korea Technology Finance Corporation and the Korea Credit Guarantee Fund, with a maximum scale of KRW 300 billion. For export-import companies vulnerable to exchange rate volatility, various supports such as exemption from deposit guarantees for forward exchange transactions, maturity extensions for import bills, and preferential exchange rates and fees are being provided.

KB Kookmin Bank is also providing KRW 15.1 trillion in total financial support for SMEs until February 14, including KRW 6.1 trillion in new loans and KRW 9 trillion in maturity extensions. It is implementing an interest rate discount benefit of up to 1.5 percentage points.

KB Kookmin Bank plans to supply KRW 2.7 trillion in new funds to vulnerable small business owners and to foster core strategic industries. It has signed agreements with the Korea Credit Guarantee Fund, Korea Technology Finance Corporation, the Korea Credit Guarantee Foundation Central Association, and 17 regional credit guarantee foundations nationwide to early implement a special contribution of KRW 105 billion, providing funds secured by guarantee certificates under these agreements.

The support targets of the Korea Credit Guarantee Fund and Korea Technology Finance Corporation include "death valley" companies within five years of establishment, vulnerable SMEs with technological capabilities but weak collateral and credit, and SMEs in core strategic industries. Regional credit guarantee foundations support small business owners and self-employed individuals within their regions, and funds can be received in connection with local government small business policy funds (including secondary interest loans).

KB Kookmin Bank also includes companies receiving non-financial services in its support targets, planning to provide both financial and non-financial services necessary for small business owners. Support targets include ▲ companies receiving KB SOHO consulting services ▲ companies receiving KB ESG consulting support ▲ companies residing in the KB Innovation Hub Center ▲ companies hiring new personnel through the KB Good Job Job Fair.

Meanwhile, Shinhan Bank also announced that it will provide KRW 15.1 trillion (KRW 6.1 trillion in new loans and KRW 9 trillion in maturity extensions) in funds until February 14 through this financial support. This includes new loans up to KRW 1 billion within the required funds per company, maturity extensions without conditions on partial principal repayment at loan maturity, and deferral of installment payments.

A Shinhan Bank official said, "We have implemented financial support to help SME customers manage their funds ahead of the Lunar New Year holiday," adding, "We will do our best to support coexistence with SMEs and small business owners."