[Small Business Second Loan] Applications Open at 7 Banks... "Excluded if Tax Arrears or Debt Delinquency Exist"

[Asia Economy Reporter Kim Hyo-jin] Pre-applications for the second emergency loan worth 10 trillion won for small business owners affected by the novel coronavirus infection (COVID-19) began simultaneously on the 18th at seven banks including Shinhan, Kookmin, Woori, Hana, Industrial Bank of Korea, NongHyup, and Daegu Bank.

The loan is available to all small business owners (individual entrepreneurs) regardless of credit rating, but since loans may be denied depending on circumstances, financial authorities and participating banks urged applicants to first verify whether they meet the loan requirements.

Those who have overdue national or local taxes or delinquent existing debts are excluded from eligibility for this second loan support. However, if tax arrears or debt delinquencies are resolved before applying, loans may be granted after review.

Applicants who have already used one of the following as part of the first emergency loan program?secondary guarantee loans handled by commercial banks, ultra-low interest loans from Industrial Bank of Korea, or management stabilization funds from the Small Enterprise and Market Service?are also excluded from this second loan.

The second loan is structured so that the Korea Credit Guarantee Fund guarantees 95% of the total loan amount. Since the participating banks conduct both loan and guarantee reviews simultaneously, there is no need to separately obtain a guarantee certificate from the Korea Credit Guarantee Fund.

The loan interest rate is around 3-4% and may vary depending on credit rating. The limit is 10 million won per business, with a maturity of 5 years (2 years grace period, 3 years installment repayment). Although applications started on this day, loan and guarantee reviews will officially begin on the 25th, a week later, so funds are expected to be disbursed sequentially starting from the end of this month at the earliest.

Applicants must prepare six documents: business registration certificate, VAT taxable standard certificate, national and local tax payment certificates, real estate registry copy (or lease contract), income amount certificate, and others. Additional documents may be required depending on each bank’s loan review criteria.

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