The Bank of Korea Extends Financial Intermediary Support Loans for Small Business Owners and SMEs by 6 Months

Deterioration of Self-Employed Financial Conditions Due to Social Distancing
Bank of Korea "13.6 Trillion Won Supported as of End of March"

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The Bank of Korea has decided to extend the deadline for the Financial Intermediation Support Loan, a financial support measure for small business owners and small and medium-sized enterprises (SMEs), by six months. This measure takes into account the financial difficulties faced by small business owners and SMEs due to the prolonged social distancing measures.

At the regular meeting on the 25th, the Monetary Policy Committee of the Bank of Korea decided to extend the financial support period for small business owners and SMEs affected by COVID-19 from the end of March this year to the end of September, a six-month extension.

The Financial Intermediation Support Loan is a system where the Bank of Korea provides funds at an ultra-low interest rate of 0.25% within a set limit determined by the bank's SME loan performance.

The Bank of Korea evaluated that the support funds for small business owners and SMEs affected by COVID-19, implemented through the Financial Intermediation Support Loan since March last year, contributed to improving financial accessibility and reducing interest burdens.

As of the end of March, the total support amount was recorded at 13.6 trillion won. From March last year to January this year, a total of 111,000 companies used the Bank of Korea's support funds, with the average loan amount per company from banks being 230 million won.

Meanwhile, the Bank of Korea has identified that the average loan interest rate has decreased by 26 to 126 basis points due to the financial support.

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