From the 18th, the interest rate for small business loans is reduced by up to 2%

Starting on the 18th, the interest rate for secondary loans at major banks targeting small business owners will drop to around 2% per year. A special support program that provides additional loans of up to 10 million won for small business owners in limited collective business that has suffered damage due to reinforced social distancing is also in operation.

The Financial Services Commission announced on the 14th that it has reorganized its financial support program to support small business owners suffering from the third spread of the novel coronavirus infection (Corona 19).

First of all, the maximum interest rate for secondary loans for small business owners will be reduced by up to 2 percentage points from the receipt on the 18th. On the 9th of last month, banknotes decided to cut their highest interest rate by 1 percentage point from 4.99% per year to 3.99% per year. Kookmin, Shinhan, Woori, Hana, Nonghyup, and IBK decided to cut another 1 percentage point.

Accordingly, interest rates of 2% per year (existing 2-4% per year) are applied at the same time in these six banks. Other banks can receive loans at an annual interest rate of 2-3%.

Among the five-year loan (2-year deferred, 3-year amortization) period, the first-year guarantee fee is down 0.6 percentage points from 0.9% to 0.3%.

Secondary loans can be received by all small business owners up to 20 million won. However, corporate business owners and small business owners who have spent more than 30 million won in their primary financial support program (IBK’s ultra-low interest rate loans, commercial bank secondary preservation loans, and management stabilization funds of the Small Business Development Corporation) are excluded.

The government has also prepared a special loan program to reduce the burden of rental fees for small business owners, whose damage is concentrated due to the collective restrictions. Among the supporting funds, which began to be paid on the 11th, small businesses (individual businesses) who can apply for 2 million won are eligible for support.

Among these, small business owners who currently have a lease contract can receive additional loans of up to 10 million won regardless of whether they use the existing small business finance support program.

An official from the Financial Services Commission said, “The situation of the computer system establishment of 12 commercial and regional banks (Kookmin, Nonghyup, Shinhan, Woori, Hana, Enterprise, Gyeongnam, Gwangju, Daegu, Busan, Jeonbuk, and Jeju) that operate secondary loans. “It is under final inspection,” he said. “From the 18th, you can apply for the reorganized secondary loan and special support program for small business owners.”

Reporter Kim Joon-young papenique@segye.com

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