Hong Nam-ki: "Card Cashback Also Supports Non-Face-to-Face Consumption... Broad Usability" (Update)

The 45th Emergency Economic Central Countermeasures Headquarters Meeting

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is speaking while presiding over the 45th Emergency Economic Central Countermeasures Headquarters meeting held at the Government Seoul Office Building on the 16th. 2021.9.16 Photo by Yonhap News

[Sejong=Asia Economy Reporter Son Seon-hee] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, stated on the 16th, "The Win-Win Consumption Support Fund (credit and debit card cashback) will consider public convenience and quarantine harmony, and will support non-face-to-face consumption as well, recognizing as wide a range of usage as possible."

Deputy Prime Minister Hong presided over the 45th Emergency Economic Central Countermeasures Headquarters meeting at the Government Seoul Office in the morning and said in his opening remarks, "We are preparing an implementation plan so that cashback can be paid starting from consumption in October."

The Win-Win Consumption Support Fund is one of the three COVID-19 damage support packages included in the 2nd supplementary budget. It provides a 10% refund on the amount exceeding 3% of the average monthly card usage in the second quarter (April to June) for citizens aged 19 and over. The monthly limit is 100,000 KRW per person. A total budget of 700 billion KRW has been allocated for this project. If the entire 700 billion KRW is spent, a consumption stimulation effect of up to 7 trillion KRW can be expected.

However, specific usage locations where cashback applies have not yet been clearly defined. The government is reportedly considering excluding department stores and large online malls to encourage consumption in small businesses and local markets, while allowing corporate supermarkets (SSMs) such as Baedal Minjok, Coupang Eats, Yogiyo, Homeplus Express, and No Brand. Regarding this, Deputy Prime Minister Hong said, "Detailed information will be announced right after the Chuseok holiday."

Meanwhile, Deputy Prime Minister Hong expressed concern over the concentrated and cumulative damage to small business owners and self-employed individuals in face-to-face service industries such as food and lodging due to the prolonged COVID-19 situation, and announced, "We will extend loan maturities and defer principal repayments for loans from the Small and Medium Business Promotion Fund (SMPF) and the Small Business Promotion Fund (SBPF) until the end of March next year."

Earlier, the financial sector also announced an additional six-month extension of the loan maturity extension and repayment deferral measures for small businesses and SMEs, which were scheduled to end at the end of this month, until March next year. Regarding this, Deputy Prime Minister Hong said, "We plan to prepare and implement detailed supplementary measures for 'orderly normalization' to prevent this extension from leading to potential borrower insolvency."

Additionally, regarding the tourism industry, which has been severely affected by COVID-19, Deputy Prime Minister Hong added, "We will expand the special credit guarantee loans for small businesses without collateral capacity by 50 billion KRW next year (from the existing 50 billion KRW to 100 billion KRW), and defer principal repayments for companies whose tourism fund loan repayment dates come due early next year for a certain period." The grace period for hotel rating evaluations, which was scheduled to end in December, will also be extended until June next year, and the government will cover 50% of the amusement facility safety inspection fees.

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