77.4 Trillion KRW Financial Support Provided Over the Past 3 Months to SMEs and Small Business Owners Affected by COVID-19

[Asia Economy Reporter Kim Hyo-jin] From early February to recently, approximately 77.4 trillion KRW has been provided to small business owners and small and medium-sized enterprises (SMEs) through government and financial sector COVID-19 financial support measures over about three months.

According to the Financial Services Commission on the 9th, related to COVID-19, a total of 890,000 cases and 77.4 trillion KRW in funds have been supported to small business owners and SMEs as of the 1st of this month through financial support plans announced on February 7 and 28, and the '100 trillion KRW+@' support measures.

New loans and guarantee support amounted to 40.3 trillion KRW, and 34.9 trillion KRW was supported through maturity extensions and repayment deferrals of existing funds. Interest payment deferrals accounted for 700 billion KRW, and export-import finance (letters of credit) and interest rate discounts provided 1.6 trillion KRW in support.

Among the total support, policy financial institutions provided 43.6 trillion KRW. Commercial banks supported 33.8 trillion KRW. By industry, the food service sector had the highest number of supported cases at 192,000 (22%). Retail (151,000 cases / 17%) and wholesale (102,000 cases / 11%) followed.

Provided by the Financial Services Commission

Applications for the second round of financial support targeting small business owners affected by COVID-19, totaling 10 trillion KRW, will begin on the 18th. The full execution process, including loan screening, is expected to start on the 25th. Six banks?KB Kookmin, NH Nonghyup, Shinhan, Woori, Hana, and Industrial Bank of Korea?will be in charge.

For medium-credit borrowers, the interest rate will be in the 3-4% range with a limit of 10 million KRW. All small business owners can apply regardless of credit rating through the six banks.

For the first program, which was 16.4 trillion KRW in scale, small business owners with credit ratings of 7 or below were supported through the Small Enterprise and Market Service (SEMAS), those with ratings 4 to 6 through the Industrial Bank of Korea, and those with ratings 1 to 3 through commercial banks’ interest subsidy loans. If support was received under the first program, the second program cannot be used.

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