<기사제목>Ministry of SMEs and Startups to Advance 5 Million KRW Compensation to 550,000 Small Business Owners

Business Restrictions from December 6 to January 16
Online Applications Available from 9 AM on the 19th
Payment of 5 Million KRW Within 3 Business Days After Application

[Image source=Yonhap News]

[Asia Economy Reporter Kim Bo-kyung] The government will provide an advance payment of 5 million KRW in compensation to 550,000 small business owners and small enterprises who recently faced operating hour restrictions.

Kang Sung-cheon, Vice Minister of the Ministry of SMEs and Startups, held a briefing at the Government Seoul Office on the morning of the 10th and announced, "From 9 a.m. on the 19th, applications for the 5 million KRW advance loss compensation will be accepted online."

The advance payment of loss compensation is a method where a certain amount is paid in advance to small business owners urgently needing compensation, and the amount will later be deducted from the finalized loss compensation.

This measure was promoted to alleviate the accumulated damage to small business owners caused by the extended social distancing measures, which were strengthened due to the spread of the Omicron COVID-19 variant last December and extended until January this year.

The advance payment will be made within three business days after application if the applicant is confirmed eligible for loss compensation, without any review of credit score, guarantee limits, tax arrears, or financial delinquency.

The eligible applicants are 550,000 small business owners and small enterprises who were subject to operating hour restrictions from December 6 last year to January 16 this year and are eligible for loss compensation for Q4 2021 and Q1 2022. Applicants will receive a total of 5 million KRW as an advance payment.

The difference between the loss compensation amount and the advance payment (5 million KRW) will be paid in mid-next month when the Q4 2021 loss compensation is disbursed. If the loss compensation is less than the advance payment, the difference will be deducted from the loss compensation, and the remaining balance can be repaid over five years.

No interest will be applied to the advance payment until the loss compensation amount is finalized. A super-low interest rate of 1% will be applied to the remaining balance after deduction by the loss compensation. There is no prepayment penalty, so early repayment is possible at any time.

In addition to the 550,000 eligible businesses for the advance payment, newly eligible 'facility capacity restriction businesses' and businesses confirmed as eligible for loss compensation by complying with operating hour restrictions in January (to be announced mid-February) can apply for a 2.5 million KRW advance payment for Q1 at the end of next month.

Applications for the loss compensation advance payment will be accepted from 9 a.m. on the 19th until midnight on the 4th of next month, including weekends and holidays, through the Small Business Policy Fund website.

To distribute simultaneous access, a five-day rotation system based on the last digit of the representative's resident registration number birth year will be applied from the 19th to the 23rd. Applications submitted by the 26th will be paid by the 28th, before the Lunar New Year holiday.

During the five-day rotation period, application hours are from 9 a.m. to midnight daily. From the 24th, when the rotation system ends, applications will be accepted 24 hours from 9 a.m.

For more details, please check the announcement on the Small Business Policy Fund website or contact the Loss Compensation Call Center, the Integrated SME Call Center, or one of the 70 regional centers of the Small Enterprise and Market Service.

Members of the Korea Federation of Self-Employed Affected by COVID-19 held a "Rally to Condemn the Government and Ruling Party and Urge Substantial Compensation for COVID-19 Damages" on the 8th in front of the National Assembly in Yeouido, Seoul, calling for substantial loss compensation and the complete lifting of gathering restriction orders. Photo by Hyunmin Kim kimhyun81@

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