Sogongyeon: "Minsheng Financial Stability Package Will Help Resolve Small Business Management Crisis"

Kim Im-yong, Acting President of the Korea Federation of Micro Enterprise Associations, along with other association officials, held an emergency press conference on the 12th at the Korea Federation of Micro Enterprise Associations in Dongjak-gu, Seoul, shouting slogans demanding the guarantee of the right to survival in relation to the damage cases of micro-enterprises caused by COVID-19. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Kim Cheol-hyun] The Korea Federation of Micro Enterprises (hereinafter referred to as KFME) positively evaluated the livelihood financial stability package program approved at the first emergency economic meeting on the response to the novel coronavirus infection (COVID-19) presided over by the President on the 19th.

In a statement released that day, KFME said, "This measure focuses on financial support to alleviate the funding difficulties of micro enterprises and small and medium-sized enterprises (SMEs), which have been hit hardest by COVID-19. It shows that the President and the government recognize the situation faced by micro enterprises and SMEs as an extraordinary crisis and have demonstrated a strong will to resolve this issue."

Through this meeting, the government announced measures including expanding the emergency management stabilization fund for micro enterprises to 12 trillion won, providing special guarantee support worth 5.5 trillion won for micro enterprises and SMEs, expanding the extension of loan principal maturity, deferring loan interest payments, and establishing a new full guarantee program worth 3 trillion won for small micro enterprises.

KFME stated, "This measure was prepared through close cooperation among financial authorities, the central bank, policy financial institutions, commercial banks, and secondary financial institutions. We believe that the significant expansion of emergency management stabilization funds and special guarantees will help resolve the currently accumulated funding applications of micro enterprises and SMEs." They added, "In particular, including measures to ease the burden of existing loans such as maturity extension and interest payment deferral is expected to help micro enterprises overcome their management crises."

However, KFME noted, "Considering the high complaints that current emergency management stabilization funds and special guarantees do not apply to existing borrowers and low credit rating holders, bold follow-up measures such as improving credit rating evaluation methods to resolve this should follow." They also said, "Since the President directly mentioned the simplification of loan screening criteria and procedures and the policy of exemption for active financial support, we hope that policy and private financial institutions will respond actively so that micro enterprises can feel the effects immediately on the ground."

Furthermore, KFME added, "We hope that follow-up measures such as direct support plans for micro enterprises and tax reduction plans will be established to open a turning point for overcoming the extreme crisis faced by micro enterprises."

This content was produced with the assistance of AI translation services.