Ministry of Culture, Sports and Tourism Supports Early Recovery of Tourism Industry with 1.44 Trillion KRW Financial Aid

Loan Repayment Deferral and Interest Reduction for All Tourism Businesses
General Loans Concentrated in the First Half of the Year... Special Credit-Guaranteed Loans Expanded to 100 Billion Won

Hwang Hee, Minister of Culture, Sports and Tourism.

[Asia Economy Reporter Donghyun Choi] The Ministry of Culture, Sports and Tourism will defer loan repayments for one year and reduce interest rates by up to 1% for all tourism businesses to help the tourism industry recover early from the prolonged impact of COVID-19. Additionally, 70% of general loans will be concentrated in the first half of the year, and special loans with credit guarantees will be significantly expanded.

The Ministry announced on the 24th that, in consultation with financial authorities, it has secured additional funds to meet the financial needs of tourism businesses affected by COVID-19 since last year and will provide emergency financing totaling 1.4429 trillion KRW. These funds will be used for repayment deferrals (381.3 billion KRW), general loans (933.5 billion KRW), and special loans (128.1 billion KRW).

To respond to the financial needs of the tourism industry, the Ministry will defer repayments totaling 360.7 billion KRW for one year for all tourism businesses whose loan repayment schedules fall due next year, following the deferrals implemented last year and this year. This will enable three consecutive years of repayment deferrals, partially alleviating the financial burden on the tourism industry.

Furthermore, to support the management stability of the tourism industry, interest on tourism fund loans will be reduced for the first time. The reduction applies to all tourism businesses that have received tourism fund loans. Starting January next year, interest rates will be reduced by 0.5 percentage points (currently 1% to 2.25%), with an additional reduction of up to 0.5 percentage points (total 1 percentage point) planned if interest rates rise. This will reduce the industry's interest burden by more than 17.9 billion KRW and provide an average annual benefit of 2.98 million KRW per business.

In addition, 549 billion KRW in general loans will be supported next year, with 70% (approximately 380 billion KRW) allocated in the first half to promote early recovery of the tourism industry. For small and medium-sized tourism businesses with weak collateral, special loans with credit guarantees will be doubled from this year to 100 billion KRW. These special loans offer various benefits such as a 1% loan interest rate and a one-year extension of the grace period, and the support limit will be raised from the existing 150 million KRW to 200 million KRW.

Tourism businesses eligible for repayment deferral can apply for deferral of repayment obligations at banks where they received tourism fund loans. Detailed schedules and conditions for repayment deferrals (including interest reductions) and general loans can be found on the Ministry of Culture, Sports and Tourism website starting today (special loans from January next year).

Kim Jang-ho, Director of the Tourism Policy Bureau at the Ministry, stated, “By strengthening practical financial support to resolve the management difficulties of tourism businesses caused by COVID-19 damage, we hope the tourism industry can overcome the crisis early and revitalize.”

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