Dongdaemun-gu Implements 11.5 Billion KRW Emergency Loans for Small Business Owners

From January 4 Next Year, Low Credit Rating Small Business Owners Eligible for 10 Million Won Loans... Annual 0.8% Low-Interest Financing Support, Overlapping Loans Allowed up to 200 Million Won Limit

[Asia Economy Reporter Park Jong-il] Dongdaemun-gu (Mayor Yoo Deok-yeol) will implement an emergency loan program totaling 11.5 billion KRW in 2021 to support small business owners facing economic difficulties due to the prolonged social distancing measures.

The district plans to provide the 11.5 billion KRW Small and Medium Enterprise Development Fund for the next year in two phases to revitalize the local economy.

The first phase, an emergency loan of 7.5 billion KRW available from January 4 to the end of March next year, targets small business owners with annual sales under 200 million KRW, located in Dongdaemun-gu (with fewer than 5 regular employees for mining, manufacturing, construction, and transportation industries fewer than 10 employees), who meet at least one of the following conditions: credit rating between 6 and 8, lower-income class, simplified taxation, multicultural or multi-child households.

The loan will be offered at a low interest rate of 0.8% per annum, supporting up to 400 businesses with a maximum of 10 million KRW per business.

Additionally, businesses in manufacturing, export, women-owned, disabled-owned, or venture companies with low credit ratings can receive up to 30 million KRW specifically for labor costs and rent.

Businesses already receiving Dongdaemun-gu SME Development Fund or small emergency loans can apply for overlapping loans up to 200 million KRW. However, businesses in finance and insurance, real estate (excluding brokerage), lodging and bars, restaurants with exclusive area over 330㎡, dance halls, golf practice ranges, precious metals and game centers, luxury, entertainment, and gambling industries are excluded from support.

Small business owners wishing to apply for loans should visit the Woori Bank Dongdaemun-gu Office branch to check their credit rating, then visit the Small Business Support Team on the B2 floor of Dongdaemun-gu Office to submit the loan application form, a copy of the business registration certificate, a copy of the business lease contract, small business confirmation certificate, VAT taxable standard certificate, national and local tax payment certificates, income amount certificate, Woori Bank credit rating confirmation, or lower-income class confirmation, or family relation certificate.

Furthermore, Dongdaemun-gu has established a 2.5 billion KRW cooperative fund with Woori Bank to support companies with high credit ratings but facing financial difficulties due to COVID-19, providing up to 30 million KRW at a variable bank interest rate, with the district subsidizing 1% of the interest.

Mayor Yoo Deok-yeol of Dongdaemun-gu stated, “We plan to promptly implement loans starting January next year to provide urgent operating funds to self-employed and small business owners struggling with the frozen local economy. We will offer practical and multifaceted support for small business owners who have difficulty obtaining loans due to low credit ratings despite financial hardships.”

Throughout this year, Dongdaemun-gu has invested 13.1 billion KRW through small emergency loans and general SME loans to support a total of 768 businesses facing difficulties due to COVID-19. The district also provided Seoul City self-employed survival funds (1.4 million KRW per business) and Small Business New Hope Funds (1 to 2 million KRW per business) to approximately 21,000 businesses in the area, striving to ensure more small business owners benefit.

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