Bank of Korea Extends Temporary Special Support for SMEs by Six Months... Until End of July

The Monetary Policy Board of the Bank of Korea announced on January 15 that it has decided to extend the operation period of the "Temporary Special Support for Small and Medium-sized Enterprises" through the Bank Intermediated Lending Support Facility by six months.

As a result, the support period has been extended from the end of January to the end of July (July 31). Even if new loans are suspended after that, support for outstanding loan balances will continue until maturity (up to one year). The Monetary Policy Board explained, "Although the economy continues to improve, as seen in the recovery of consumption and the increase in exports, the recovery of vulnerable sectors such as regional small and medium-sized enterprises and self-employed businesses is lagging behind, so it is necessary to continue supporting them."

The Temporary Special Support for Small and Medium-sized Enterprises was introduced in January 2024 with a limit of 9 trillion won and was operated for six months, with the deadline extended twice in July of that year and in July of the previous year. In January of the previous year, the limit was increased by 5 trillion won to a total of 14 trillion won (2.8 trillion won for Seoul and 11.2 trillion won for regional areas).

Meanwhile, the Bank of Korea plans to reform the Bank Intermediated Lending Support Facility within the year to strengthen its function as a monetary policy tool. The Bank of Korea stated, "During the reform process, programs that were introduced and operated temporarily will be terminated in a timely manner, and we will improve and supplement the facility to enhance its flexibility in response to changes in the economic environment."