Gwangju Gwangsan-gu Unsecured 1% Loan Draws Attention from the National Assembly

Democratic Party's Lee Kwang-jae Demands Nationwide Expansion of Gwangsan-gu Loan Model in Government Questioning

[Asia Economy Honam Reporting Headquarters Reporter Lee Gwan-woo] The public-private-academic governance for overcoming COVID-19 in Gwangsan District, Gwangju Metropolitan City, known as the ‘Gwangsan Economic Vaccine Meeting,’ has attracted attention from the National Assembly for its regional economic revitalization policies.

According to Gwangsan District on the 9th, during the government questioning session on social, education, and cultural affairs at the National Assembly the previous day, Lee Kwang-jae, a member of the Democratic Party of Korea representing Wonju-si Gap, Gangwon Province, called for the nationwide expansion of Gwangsan District’s 1% ultra-low interest unsecured loan model as a measure to overcome bankruptcies and cash shortages caused by the prolonged COVID-19 pandemic.

The model mentioned in the National Assembly is the 8th and 12th policies among the total 12 ‘economic vaccines’ prepared by the Gwangsan Economic Vaccine Meeting to invigorate the local economy.

The economic vaccines, conducted under the names ‘1% Hope Loan’ and ‘Boss’s Comeback Hope Theory,’ were designed for low-credit and low-income small business owners facing economic crises due to the prolonged COVID-19 pandemic.

The two loans were provided three times last year: from June to August, October to November, and November to December.

The support targets were small business owners and self-employed individuals in the blind spots of government support policies, such as those with annual sales under 100 million KRW whose sales decreased by 20% before and after COVID-19, low-income and low-credit borrowers, small business owners subject to loan regulations, small card loan borrowers, and unregistered self-employed persons.

They received unsecured loans at a 1% interest rate for one year, with a maximum of 10 million KRW per person.

Of the existing loan interest rate of 4.5%, borrowers paid 1%, and the remaining 3.5% interest was supported by the Gwangsan Economic Vaccine Funding, which was raised by the Gwangsan Economic Vaccine Meeting, enabling the loans.

The Gwangsan Economic Vaccine Meeting helped a total of 328 people with loans amounting to 1.5066 billion KRW over three rounds and compensated 53.22 million KRW in interest.

Notably, five local financial institutions, including Gwangju Eoryong Credit Union, Bia Credit Union, and Seogwangju Saemaeul Geumgo, participated in these loans, creating a model of overcoming the economic crisis through the value of coexistence.

Kim Sam-ho, Mayor of Gwangsan District, stated, “In the unprecedented crisis of COVID-19 and economic recession, I hope that the economic vaccine created by the Gwangsan District public-private-academic governance will become a government policy that alleviates the difficulties of small business owners nationwide,” adding, “We will lead the policies of the Democratic Party of Korea and the government with more livelihood policies produced through community collaboration.”

Meanwhile, since its launch in April last year, the Gwangsan Economic Vaccine Meeting has continued to prescribe economic vaccines for regional economic revitalization, including Gwangsan Economic Vaccine Funding, community jobs and Gwangsan-type citizen allowances, Gwangsan District Boss Vitality Support Fund, small business cooling cost support, and the Safe Zone Project, in addition to the two types of loans.

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