Bank of Korea Allocates 30 Billion KRW in Financial Intermediation Support Loans for SMEs Affected by Heavy Rainfall
Temporary Special Support Program for SMEs
9 Trillion KRW Extended Until End of January Next Year
The Bank of Korea has urgently allocated 30 billion KRW from its reserved Financial Intermediation Support Loan limit to regional headquarters overseeing areas affected by heavy rainfall, in order to support small and medium-sized enterprises (SMEs). The Financial Intermediation Support Loan is a system in which the Bank of Korea lends funds to commercial banks at low interest rates, encouraging these funds to be extended as loans to SMEs and similar entities.
On July 24, the Bank of Korea announced that it has allocated 10 billion KRW each to the Gwangju-Jeonnam and Gyeongnam headquarters, and 5 billion KRW each to the Gyeonggi and Daejeon-Sejong-Chungnam headquarters. The recipients of this funding are SMEs that have suffered damage from torrential rains, and the support ratio is 100% of the loan amount handled by financial institutions. The Bank of Korea stated, "We will review the situation regarding damage from heavy rainfall and the loan demand from eligible SMEs, and will provide additional support if necessary."
Meanwhile, the Bank of Korea has extended the deadline for the initial 9 trillion KRW temporary special support program for SMEs from the end of this month to the end of January next year, a six-month extension. The Bank of Korea explained, "We determined that it is necessary to continue supporting vulnerable sectors such as low-credit self-employed individuals and regional SMEs, as business recovery is being delayed due to increased external uncertainties and their financial conditions remain difficult."
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The Bank of Korea launched the temporary special support program for SMEs with a 9 trillion KRW limit in January last year. In January of this year, it increased the limit by 5 trillion KRW for a one-year period, operating the program at a total scale of 14 trillion KRW.
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