Gwangju City Supports Small Business Owners with Management Stabilization Fund Loans

Gwangju City Hall

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] Gwangju Metropolitan City announced on the 18th that it is continuing to provide special guarantee loans for neighborhood markets to support the business stability of small business owners and self-employed individuals who are struggling due to the prolonged spread of COVID-19 infection.

Gwangju City has signed a special guarantee support project agreement for neighborhood markets with the Gwangju Credit Guarantee Foundation and nine financial institutions (Gwangju, NH Nonghyup, Kookmin, Shinhan, Hana, Industrial, Nonghyup Central Association, Saemaeul Geumgo, and Credit Union) and is supporting business stabilization funds for local small business owners and self-employed individuals.

The support targets small business owners and self-employed individuals in 58 industries including wholesale and retail, food and lodging, and service industries within the region. The support period is from last February until the end of the year, and the support scale is a total of 43.2 billion KRW, which is 12 times the contribution funds from the city and financial institutions.

The support amount is up to 25 million KRW per business, and the support conditions allow a choice between fixed interest rates (3.0% for 3 years, 3.2% for 5 years) and a variable interest rate of 2.03% (as of September), with principal repayment in installments without a grace period. Additionally, the full loan interest is supported for one year from the loan date.

In particular, this year the city increased the special contribution fund and guarantee scale from 34 billion KRW to 43.2 billion KRW compared to the previous year, lowered loan interest rates (fixed interest rate basis: 3-year repayment from 3.5% to 3.0% / 5-year repayment from 3.7% to 3.2%), implemented 100% screening and guarantee by the Credit Guarantee Foundation and reduced guarantee fees (from 0.8% to 0.7%), adjusted screening criteria to expand loan support for low credit rating borrowers, and from May, temporarily expanded to full loan interest support for one year.

The application procedure requires eligible businesses to submit related documents to the Gwangju Credit Guarantee Foundation or financial institutions. The Credit Guarantee Foundation then conducts a screening process including personal credit and business site verification, issues a guarantee certificate, and the corresponding financial institution executes the loan.

Baek Hyun-sook, head of the City’s Livelihood Economy Division, said, “There is still room in the support guarantee scale until the end of the year, so we hope small business owners and self-employed individuals who are struggling due to the prolonged spread of COVID-19 infection will take a keen interest in the special guarantee loans for neighborhood markets and receive support.”

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