Gwangjin-gu Expands Special Loans for Small Business Owners with Interest-Free and Guarantee-Free Support from 1 Year to 2 Years

Loan limit per company raised from 20 million KRW to 30 million KRW... Support expanded to allow existing borrowers to receive overlapping support within the 30 million KRW limit

[Asia Economy Reporter Park Jong-il] Gwangjin-gu (Mayor Kim Seon-gap) is significantly expanding and implementing the support for the ‘Gwangjin-type Interest-Free and Guarantee-Free Special Loan’ to alleviate financial difficulties and reduce burdens for small business owners.

First, the support period for interest and guarantee fees incurred during the loan has been extended from the existing 1 year to 2 years. In addition, the loan limit per business has been raised from 20 million KRW to 30 million KRW. Existing borrowers can also receive additional support within the maximum limit of 30 million KRW.

The interest will be paid monthly to the bank by the district office for 2 years, and the guarantee fee will be handled by the borrower paying the full 5 years’ worth upfront, after which the district office will deposit 2 years’ worth of guarantee fees back into the borrower’s account.

The support targets small business owners with annual sales under 200 million KRW who are registered as business operators within the district, applicable from new loans taken out since March 2022.

Repayment conditions are a 1-year grace period followed by 4 years of equal installments. After the 2-year support period ends, an annual interest rate of 2% (variable) and an annual guarantee fee of 0.8% will be applied for the remaining period.

Small business owners wishing to apply for the loan should make a phone reservation with the Seoul Credit Guarantee Foundation Gwangjin branch, receive a guarantee certificate through a consultation visit, and then obtain the loan at one of the six Woori Bank branches within the district.

Mayor Kim Seon-gap of Gwangjin-gu said, “The opportunity to secure funds for rapid recovery to pre-COVID levels should be open to everyone,” adding, “After careful consideration, we have extended the Gwangjin-type interest-free and guarantee-free special loan period to 2 years so that small business owners can receive funds without burden at any time and lay the foundation for their leap and growth.”

Gwangjin-gu was the first in Seoul to implement interest-free and guarantee-free (1 year) special support in 2020, and over the past two years, it has established the largest guarantee scale in Seoul, actively supporting small business owners with insufficient collateral capacity to overcome COVID-19.

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