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  • KRW 300B in Emergency Loans to Support Small Businesses Recover

  • Economy & Investment News SMG 5624

    The Seoul Metropolitan Government (SMG) is issuing additional KRW 300 billion interest-free emergency loans to support the recovery of small business owners who have suffered hardship due to the prolonged COVID-19 pandemic.

    The SMG is marketing this significant financial assistance as “four-free reliable loans”—the four free concepts being interest-free, guarantee fee-free, collateral-free, and paper document-free—following the campaign promises of Mayor Oh Se-hoon. After allocating KRW 2 trillion in June and recognizing the urgency of people’s needs, the SMG drew up its available budget and prepared additional KRW 300 billion.

    The SMG’s “four-free reliable loan” program is innovative financial assistance that is interest-free, guarantee fee-free, collateral-free (guaranteed by the Seoul Credit Guarantee Foundation), and paper document-free for easy loan application.

    Since June, the SMG has invested KRW 2 trillion in policy funds to normalize business operations from the critical status quo. As a result, loans of KRW 1.95 trillion (98%) have been provided, and it is close to running out (as of Oct. 27). This confirms the effectiveness of policy funds that target small businesses who have difficulty taking out loans from banks due to lack of collateral.

    The SMG’s four-free reliable loan program, which resumes supply in November, will be provided under the same criteria as those supplied since June. Every applying company can receive loans of up to KRW 100 million after a screening of its credit limit, and up to KRW 20 million without screening. The total loan period is five years. For low-credit applicants, the screening criteria will be relaxed to eliminate blind spots for the financially underprivileged.