Seocho-gu Expands Low-Interest Loan Support for Small and Medium-Sized Businesses

▲Loan Support: Total of 4.5 Billion KRW, Ultra-Low Interest Rate of 0.1% Applied Until July Next Year, Repayment Within 5 Years, Flexible Repayment Method ▲Ultra-Fast Loan: Low-Interest Loan Up to 50 Million KRW Regardless of Credit Score

[Asia Economy Reporter Jong-il Park] Seocho-gu (Mayor Jeon Seong-su) is expanding low-interest loan support for small and medium-sized business owners who are experiencing management difficulties due to the prolonged COVID-19 pandemic, rapid inflation, and interest rate hikes.

This project is part of Seocho-gu’s “Walking with the Vulnerable” initiative and was prepared to improve the existing “Small and Medium Enterprise Development Fund Loan Support” and “Ultra-Speed Loan” programs implemented by the district, so that many small and medium-sized business owners can benefit and be given opportunities for a fresh start.

The main points are ▲expansion of loan scale and reduction of loan interest rates ▲extension of repayment period ▲expansion of support targets.

First, the district increased the total scale of the “Small and Medium Enterprise Development Fund Loan Support” from the existing 4 billion KRW to 4.5 billion KRW, and from August to July next year, lowered the existing interest rate from 1.5% to 0.1% to reduce the burden of interest. Loans are up to 200 million KRW per company.

Also, the district extended the repayment period of the “Small and Medium Enterprise Development Fund Loan Support” from the existing total of 4 years (1 year grace period, 3 years equal installment repayment) to a total of 5 years. The repayment method can be freely chosen considering the borrower’s financial situation between 1 year grace period with 4 years equal installments or 2 years grace period with 3 years equal installments. For example, when borrowing 100 million KRW, the monthly interest can be used at around 8,000 KRW for 5 years.

The “Small and Medium Enterprise Development Fund Loan Support Project” is scheduled to be implemented from August, and applicants must have their main office (headquarters) located in Seocho-gu or be a manufacturing company registered with a factory in Seocho-gu as of the application date. Applications will be accepted on a rolling basis from August until funds are exhausted.

In addition, the district expanded the support target of the “Ultra-Speed Loan,” which provides loans up to 50 million KRW to small and medium-sized business owners lacking collateral, from those with credit ratings of 3 or below to all credit ratings starting from the 18th. The district expects this to help more small and medium-sized business owners meet urgent funding needs.

Since 1993, the district has played a pivotal role as a financial support pillar for local small and medium-sized business owners by supporting a total of 487 companies with 61.7 billion KRW through the “Small and Medium Enterprise Development Fund Loan” and supporting about 2,779 companies with approximately 62.4 billion KRW through the “Ultra-Speed Loan” since 2020.

Seocho-gu Mayor Jeon Seong-su said, “I hope this loan support project will help stabilize the management of small and medium-sized business owners exhausted by the prolonged COVID-19 pandemic,” and added, “We will continue to discover various projects that provide practical help to small and medium-sized business owners.”

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