Yeongdeungpo-gu Provides Small Business Owners with 20 Million Won Interest-Free Loans for One Year

On the 22nd, Seoul Credit Guarantee Foundation and 3 Banks Sign Special Guarantee Agreement... Jointly Contribute 2 Billion KRW with Banks to Secure 25 Billion KRW Guarantee Scale... Up to 20 Million KRW Interest-Free Loans for 1 Year to Small Businesses and Small Merchants Lacking Funds

[Asia Economy Reporter Park Jong-il] Yeongdeungpo-gu (District Mayor Chae Hyun-il) will sign a business agreement on the 22nd with the Seoul Credit Guarantee Foundation (hereinafter referred to as the Guarantee Foundation) and three banks?Woori, Shinhan, and Hana?to support small businesses and small merchants in the area struggling with financial difficulties due to COVID-19.

This agreement is intended to provide a special guarantee fund that supports interest-free loans for one year to local small merchants. Due to COVID-19, the agreement will be conducted in writing.

Through this agreement, the district will contribute a total of 2 billion KRW to the Guarantee Foundation together with the three banks (1.6 billion KRW from the district and a total of 400 million KRW from the banks).

The guarantee scale is 25 billion KRW, which is 12.5 times the contribution amount. With these funds, guarantees will be provided to small businesses and small merchants in Yeongdeungpo-gu who lack collateral.

When small businesses and small merchants apply for the special guarantee at designated branches of the three banks?Woori, Shinhan, and Hana?the district will recommend and issue guarantee certificates through the Guarantee Foundation, and the banks will approve loans considering the applicant’s guarantee limit.

With this special guarantee support, from April 26 until funds are exhausted, small businesses and small merchants will be able to secure up to 20 million KRW in interest-free funds for one year.

Since the district supports the interest on the loans for one year, the benefit is effectively interest-free, and a variable interest rate will apply thereafter. The repayment period is five years, with a one-year grace period followed by four years of equal installment repayments.

Eligible borrowers are small businesses and small merchants located in Yeongdeungpo-gu with a business operation period of six months or more who lack sufficient collateral. Those who are currently delinquent, are repaying guarantees supported by the Seoul Credit Guarantee Foundation in 2021, or belong to industries such as luxury, entertainment, or other restricted sectors are excluded. For more details, please refer to the district’s website.

Chae Hyun-il, Mayor of Yeongdeungpo-gu, stated, “As the COVID-19 crisis prolongs, the difficulties faced by local small businesses and small merchants are beyond words. We hope that financial support through public-private cooperation will help these businesses recover and revitalize the local economy.”

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