Ministry of SMEs Expands Guarantees for Small Business Owners in Restaurants and Cafes

Expansion of 'Emergency Liquidity Special Guarantee' Support Targets Following Social Distancing Level Upgrade

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[Asia Economy Reporter Kim Cheol-hyun] The Ministry of SMEs and Startups (Minister Park Young-sun, hereinafter referred to as the Ministry) announced on the 7th that it will revamp the 'Emergency Liquidity Special Guarantee' of the Regional Credit Guarantee Foundation (hereinafter referred to as Regional Credit Guarantee) that offers loans at 2.0% interest starting from the 11th. With this revamp, restaurants and cafes will be added to the supported industries, and small business owners who have already received loans under the first small business program will be able to receive overlapping support.

The Ministry explained that this revamp was made in response to the recent spread of the novel coronavirus infection (COVID-19), which led to the strengthening of social distancing levels and the Central Disaster and Safety Countermeasures Headquarters (hereinafter referred to as CDCH) reorganizing the classification system from the existing 'high-risk facilities' to 'priority management facilities.' Previously, restaurants and cafes were not included in high-risk facilities, but recently the CDCH designated them as priority management facilities. From social distancing level 2, restaurants are only allowed to operate until 9 p.m., and cafes are only allowed takeout and delivery at all times, which is expected to worsen sales decline, so they have been included in the support targets.

In regions with social distancing level 2 or below, loans are available for restaurants, cafes, entertainment bars, emotional bars, hunting pubs, karaoke rooms, indoor standing concert halls, direct sales promotion centers, academies, PC rooms, and indoor sports facilities. In regions where the level is raised to 2.5 or higher, the support targets will be expanded to include general management facilities such as beauty salons, bathhouses, and stores.

Also, as COVID-19 prolongs, the demand for funds continues, so those who have already received 30 million won under the first small business program and 20 million won under the second program can receive an additional 10 million won through this product. The revamped program will be available for application and reception through 12 commercial banks nationwide and 16 Regional Credit Guarantee Foundations starting from the 11th. Hwang Young-ho, head of the Corporate Finance Division at the Ministry, said, "We hope that the revamp of the Emergency Liquidity Special Guarantee will help meet the urgent funding needs of small business owners who are facing increased difficulties due to the intensification of social distancing levels."

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