Incheon City Provides 20 Billion KRW in Business Stability Funds for Small Merchants... Job Creation and Revitalization of Local Markets

Incheon City Hall

[Asia Economy Reporter Park Hyesook] Incheon City is implementing a total of 20 billion KRW in business stabilization fund loans to increase employment at small business sites and support neighborhood commercial sectors.

The city recently announced on the 29th that it plans to supply 10 billion KRW each through special guarantees for 'job creation activation' and 'neighborhood commercial sector activation' to help small business owners struggling with the recent economic difficulties.

The support limit per company is 30 million KRW and 20 million KRW respectively, and applications will be accepted from the 3rd of next month at each branch of the Incheon Credit Guarantee Foundation in the region.

This loan aims to promote employment activation at small business sites by providing funds to companies that have newly hired or maintained employment within the past year, companies within three years of startup, and excellent job-creating companies. It also supports neighborhood commercial sectors severely affected by the expansion of online purchases and consumption contraction due to high inflation.

To this end, the city will contribute 1.6 billion KRW as guarantee funds, the Incheon Credit Guarantee Foundation will supply a total of 20 billion KRW in guarantees, and commercial banks will execute direct loans.

Along with financial support, the city will partially support (interest subsidy) the interest burden of small business owners for three years.

The job creation activation special guarantee provides differentiated interest support of 1.0%, 1.5%, or 2.0% depending on the scale of newly hired personnel maintained within the past year, while the neighborhood commercial sector activation special guarantee supports 1.5% for three years.

The job creation activation special guarantee targets ▲companies that have hired new personnel or maintained employment within the past year ▲companies within three years of startup ▲companies selected as excellent job-creating companies ▲companies selected as good workplaces in the root industry ▲small manufacturers (manufacturing with fewer than 10 regular employees). Loans up to 30 million KRW are available.

The neighborhood commercial sector activation special guarantee supports small businesses and small business owners engaged in the restaurant industry, wholesale and retail trade, educational services, leisure-related services, and personal services, with loans available up to 20 million KRW.

However, those who have already received guarantee support from the Incheon Credit Guarantee Foundation within the past three months, those in restricted guarantee industries (gambling, entertainment, leisure, tobacco-related industries, etc.), or those with delinquent or overdue existing loans are excluded from support.

For both funds, the loan conditions are a 5-year maturity with a 1-year grace period followed by 4 years of principal installment repayment, but immediate principal installment repayment without a grace period or shortening of the maturity is also possible.

The guarantee fee for a 5-year maturity is basically 0.8%, and if the principal is repaid immediately without a grace period or the maturity is shortened from 5 years, an additional 0.2%p discount is applied.

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