1.9 Trillion KRW in the First Half of This Year...
Up to 300 Million KRW Per Company
Gwangju City will provide 270 billion KRW in management stabilization funds this year to support the business stability of small and medium-sized enterprises (SMEs) in the Gwangju area, which are experiencing financial difficulties due to high interest rates and economic slowdown. This amount is 5 billion KRW more than last year's 265 billion KRW.
The city will provide 190 billion KRW in management stabilization funds in the first half of this year. Applications will be accepted until the allocated funds are exhausted.
The support targets are SMEs with business locations in Gwangju, including manufacturing companies with a manufacturing specialization rate of 30% or more, manufacturing-related service companies, knowledge industry center construction companies, and knowledge service companies as defined by the “Gwangju City SME Promotion Fund Special Account Establishment and Operation Ordinance.”
The maximum support amount is 300 million KRW per company. Preferential companies such as PRE and Premium Small Giants, Excellent Job-Creating Companies, Gwangju-Type Job Companies, Outstanding SMEs, and Excellent Industrial Safety and Health Companies can receive up to 500 million KRW.
This year, the city temporarily exempted the submission of fund repayment confirmation documents for existing borrowers to reduce their burden. In addition, the city expanded the eligible industries for manufacturing-related service companies and allowed a one-time extension of the loan handling period, making it easier for more SMEs to apply.
The loan terms are a lump-sum repayment after a two-year grace period. To help SMEs overcome difficulties, the city covers a 2% interest rate difference with municipal funds, and an additional 1% is provided for preferential companies. Considering the economic downturn, companies whose sales or operating profit have decreased by 10% or more will receive an additional 1% interest support. Preferential companies that have incurred operating losses can receive up to 4% interest support.
With the continuation of the companion support agreement fund loan among the management stabilization funds this year, companies applying for loans with a credit guarantee certificate as collateral can receive a reduction of about 1.2% in guarantee fees from IBK and guarantee institutions.
SMEs wishing to receive management stabilization funds can apply online through the Gwangju Economic Promotion and Win-Win Job Foundation Fund Loan Management System and then submit the required documents. After online document submission and review, applicant companies can receive loans from 13 banks, including Gwangju Bank.
Hong Nasun, Head of the Startup Promotion Division, said, “Considering the current domestic and international economic situation, we have expanded the scale of support compared to last year and prepared improvement measures that SMEs can feel,” and added, “We hope that the management stabilization funds will serve as a priming pump to resolve the funding difficulties faced by local SMEs struggling with business operations such as financing.”
Meanwhile, since 2004, Gwangju City has provided about 200 billion KRW annually in management stabilization funds for SMEs. Since 2020, the support amount has increased in response to economic situations such as the COVID-19 economic crisis, the triple crisis of high interest rates, high prices, and high exchange rates, and the court receivership application of Daewoo Winia affiliates.
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