Ministry of SMEs and Startups and Bank of Korea Sign MOU to Support SMEs in Crisis-Signaled Areas

Starting from April 24 in Daegu and Gyeongbuk Region, Business Agreement
Providing Low-Interest Funding to Small and Medium Enterprises
Follow-up Measures to Promote Innovative Growth of Local SMEs

The Ministry of SMEs and Startups and the Bank of Korea have joined forces to assist small and medium-sized enterprises (SMEs) in 'crisis-signaling areas.' On the 24th, the Ministry of SMEs and Startups announced, "To proactively prevent crises and strengthen the competitiveness of SMEs located in crisis-signaling areas, a business agreement will be signed between the local SME offices of the Ministry of SMEs and Startups and the regional headquarters of the Bank of Korea."

Crisis-signaling areas are regions where key indicators such as the number of companies, number of employees, and sales have deteriorated, mainly in SME-dense areas such as industrial complexes, knowledge industry centers, and venture business promotion districts. The local SME offices determine crisis-signaling areas based on monitoring results from crisis support centers. The regional headquarters of the Bank of Korea supports SMEs located in these areas by providing low-interest funds through financial institutions to strengthen the regional crisis management system. Through this, the targeted companies are expected to secure funding more easily from financial institutions and reduce financial costs.

The Bank of Korea operates a local SME support program worth 5.9 trillion won. Support is provided up to 50% of the financial institution loan amount. The support limit varies depending on the support category (three in total): 2 billion won for the strategic category, and 1 billion won for the special and general categories. The support interest rate for financial institutions is 2.0%, which offers an interest rate reduction effect compared to general loans.

The government announced the 'Regional SME Innovation Growth Promotion Plan' on the 6th. This business agreement is a follow-up measure. At that time, a plan to advance the regional SME crisis management system was announced. The plan included expanding crisis support centers, currently operating in five regions last year and twelve regions this year, nationwide by 2027, while strengthening the regional crisis management system by proactively supporting crisis-signaling companies with finance, sales channels, and more.

The Ministry of SMEs and Startups and the Bank of Korea plan to sequentially promote business agreements in 12 regions, starting with the Daegu-Gyeongbuk area on the 24th, followed by Gangwon, Busan, Jeonnam, and others. Minister Lee Young of the Ministry of SMEs and Startups stated, "We will continue to prepare various support policies in collaboration with related organizations to proactively respond to crises that regional SMEs may face."

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