Changwon Special City to Actively Support Small and Medium Enterprises Next Year

2 Billion KRW Support for SME Development Funds, Up to 500 Million KRW per Company

Changwon Special City in Gyeongnam has finalized its support plan for small and medium-sized enterprise development funds for next year and decided to actively provide support.

[Asia Economy Yeongnam Reporting Headquarters, Reporter Song Jong-gu] Changwon Special City in Gyeongnam held a Small and Medium Business Development Fund Loan Review Committee meeting on the afternoon of the 26th and finalized the support plan for next year's small and medium business development funds, deciding to actively provide support.

The small and medium business development fund is a support policy for SMEs that need funds for business management and facility investment. In 2023, a total of 200 billion KRW was allocated, consisting of 150 billion KRW for management stabilization funds (80 billion KRW in the first half, 70 billion KRW in the second half) and 50 billion KRW for facility funds.

The support includes subsidizing part of the interest incurred on new loans from contracted financial institutions, providing support at 2.5%p for two years, which is 0.5%p higher than the previous year to alleviate the interest burden on SMEs.

The support targets SMEs with headquarters and business sites in Changwon Special City, including registered manufacturing factories, shipbuilding and aviation cooperative manufacturers, software industry, three types of manufacturing-related service industries (sewage and wastewater treatment, waste collection and transportation, waste treatment), and research and development related to the 4th industrial revolution. For management stabilization funds, social enterprises, cooperatives, and unregistered manufacturing factories (if the building register indicates factory or manufacturing use) are also supported.

The loan limit per company is up to 50% of sales on financial statements, with management stabilization funds capped at 300 million KRW (400 million KRW for special enterprises) and facility funds at 500 million KRW (700 million KRW for special enterprises). The total limit per company cannot exceed 500 million KRW (700 million KRW for special enterprises).

However, for the software industry, manufacturing-related service industries, and 4th industrial revolution-related R&D, support is limited to 100 million KRW for management stabilization funds and 200 million KRW for facility funds. Social enterprises, cooperatives, and unregistered manufacturing factories are supported up to 100 million KRW only for management stabilization funds.

Additionally, in 2023, support for nuclear power industry-related cooperative companies will be expanded to facilitate the early normalization of the nuclear industry. Not only manufacturing but also construction, distribution, and transportation industries related to the nuclear power industry are included as support targets. Under special support, the secondary interest subsidy rate is 2.5%p, with management stabilization funds up to 400 million KRW and facility funds up to 700 million KRW, totaling a loan limit of 700 million KRW, which is 200 million KRW higher than for general companies.

Applications will be accepted from January 4, 2023, through nine commercial banks that have signed business agreements with the city. Since this is a bank-cooperated loan rather than a direct loan from the city, applications can be made after prior consultation with the banks.

First Deputy Mayor Ahn Kyung-won said, “The weakening of the business sentiment felt by SMEs due to continuous interest rate hikes and rising raw material prices is expected to continue next year,” adding, “Changwon Special City will expand financial support that companies need most to secure the competitiveness of local industries and contribute to crisis management, and will not spare continuous support.”

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