Up to 50 Million KRW Loans for Small Business Owners and Self-Employed Starting in July
3-4% Interest Subsidy Provided... Apply via Gwangju Credit Guarantee Foundation
Gwangju Mayor Kang Gi-jung is taking a commemorative photo after signing the "2025 Special Guarantee Support Agreement for Small Business Owners" with eight related organizations including Gwangju Credit Guarantee Foundation, Gwangju Bank, KB Kookmin Bank, NH Nonghyup Bank, Shinhan Bank, Hana Bank, Woori Bank, and KakaoBank at the Gwangju Chamber of Commerce and Industry's main conference room on January 23, when the "2025 Gwangju Economy Together Steadily" event was held. Photo by Gwangju City
The Gwangju City Government is implementing a "special guarantee for small business owners" to revitalize the local neighborhood economy, which is facing a crisis due to the ongoing economic downturn.
On July 2, Gwangju City announced that it will launch a special guarantee program worth 50 billion KRW in the second half of the year, starting in July, to help stabilize the management and resolve the funding difficulties of small business owners. The total amount of special guarantees for small business owners this year is a record-high 170 billion KRW. The city implemented 120 billion KRW in special guarantees in the first half of the year, starting in January, and will provide an additional 50 billion KRW in the second half.
Reflecting the current high inflation, the maximum loan limit per business is set at 50 million KRW, and the special guarantee program will continue until the guarantee limit is exhausted. For borrowers, general credit holders will receive a 3% interest subsidy, while medium and subprime credit holders will receive a 4% interest subsidy, both for one year.
This special guarantee loan program is available to all small businesses, micro-enterprises, and self-employed individuals based in Gwangju, except for certain sectors such as entertainment, gambling, and speculative businesses. Loan approval is subject to review and guarantee by the Gwangju Credit Guarantee Foundation, and collateral is not required.
Repayment methods include lump-sum repayment, or installment repayment over 2, 4, or 6 years after a one-year grace period, and applicants can choose their preferred option. The loan interest rate is variable, set at short-term COFIX +1.5~1.6% or 91-day CD rate +1.5~1.6%, with a guarantee fee of 0.7% per year. Those wishing to apply for the special guarantee for small business owners should make a consultation reservation on the Gwangju Credit Guarantee Foundation website and visit the relevant branch on the reserved date.
Joo Jaehee, Director of Economic and Startup Affairs, stated, "We hope that the implementation of the special guarantee program in the second half of the year will help alleviate the funding difficulties and interest burden for small business owners. We will continue to develop and promote various support policies to ensure the stability of small business management."
Meanwhile, Gwangju City is operating the "Neighborhood Economy Situation Room," which serves as a hub for on-site, practical policy implementation to revitalize local commercial districts and protect small business owners. The city is also pursuing concrete support measures that provide real benefits to small business owners, including: allowing nighttime parking on roads around neighborhood commercial districts; one-to-one matching support between city/public institutions and traditional markets/neighborhood shopping areas; promoting the Gwangju public delivery app; and establishing a dedicated organization for neighborhood commercial districts.
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