Daejeon Provides 365 Billion KRW to Support 'SME Development'... New Inclusions Such as Travel and Transportation Industries

[Asia Economy (Daejeon) Reporter Jeong Il-woong] Daejeon City will provide 365 billion KRW in management stabilization funds for small and medium-sized enterprises (SMEs). This amount is an increase of 45 billion KRW compared to the previous year. This year, travel and transportation industries, which were previously excluded, are newly included in the target sectors, and the loan interest rates are lowered, focusing on reducing the burden on companies.

The city announced the SME development fund support plan with these details on the 18th. According to the support plan, this year a new “Daejeon-type New Deal Policy Fund” will be established to support ventures and startups in non-face-to-face and New Deal sectors, and travel agencies, charter bus businesses, and corporate taxi businesses will be newly included as support targets.

Additionally, the loan limit for management stabilization funds will be raised from 200 million KRW to 300 million KRW per company. In particular, the city explained that the loan interest rate for the special guarantee management improvement fund for small enterprises will be lowered by 0.3% compared to last year, reducing the actual interest burden on companies to around 1%.

The support scale by sector is ▲“Management Stabilization Fund (250 billion KRW)” supporting employee wages or management expenses ▲“Startup and Competitiveness Enhancement Business Fund (50 billion KRW)” supporting factory relocation or facility investment ▲“Daejeon-type New Deal Policy Fund (Management Stabilization Fund 30 billion KRW)” supporting ventures and startups in non-face-to-face, bio, and New Deal sectors ▲“Purchase-Conditioned Production Support Fund (30 billion KRW)” supporting funds for purchasing product parts or raw materials ▲and ▲Small Enterprise Special Guarantee (5 billion KRW).

Specifically, the management stabilization fund and startup and competitiveness enhancement business fund are funds that compensate a certain portion of the interest incurred on bank loans. The city supports 2~3% and 1~2% interest rate differences of the loan amount, respectively.

Also, the Daejeon-type New Deal Policy Fund is used to provide loans up to 300 million KRW per company for funds necessary for business activities (purchase of raw materials, product production, wages, etc.), and the purchase-conditioned production support fund offers low-interest loans at around 1% for 75% of the required funds (up to 500 million KRW) when domestic or overseas supply contracts are made.

The small enterprise special guarantee targets small enterprises with five or more regular employees (ten or more for mining, transportation, and construction industries) and provides guarantee support within 100 million KRW, 2% interest rate compensation on the loan amount, and full guarantee fee coverage (1.1%) for two years.

At this time, companies with excellent technology but facing difficulties due to collateral issues will receive full support (up to 500 million KRW) for guarantee amounts from the Korea Technology Finance Corporation or the Korea Credit Guarantee Fund through technology credit evaluation guarantees, according to the city.

Applications for funds can be made through the Daejeon Biz portal site for SME support operated by the Daejeon Economic and Trade Promotion Agency, and applications are accepted year-round until funds are exhausted.

For more detailed information about fund support, inquiries can be made through the city’s website or the City Enterprise Startup Support Division and the Daejeon Economic and Trade Promotion Agency.

Ko Hyun-duk, Director of the City’s Job and Economy Bureau, said, “We will do our best to support policy funds to revitalize management stabilization and job creation for SMEs struggling due to COVID-19.”

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