Seoul's Seongdong-gu is rolling out 6.5 billion won ($4.67 million) in second-half loan support for local small and medium-sized enterprises and small business owners struggling with economic headwinds and high borrowing costs, the district office announced.
The program pools 3.5 billion won in district funds with 3 billion won in commercial bank partnership funds for a combined 6.5 billion won, which the district expects will provide meaningful relief to businesses facing cash-flow difficulties.
Eligible applicants must operate a business in Seongdong-gu and have held a business registration for at least six months. Businesses currently repaying an existing Seongdong-gu SME development fund loan, those that have suspended or closed operations, and applicants with outstanding tax arrears are excluded.
The district funds carry a fixed annual interest rate of 1.5%, while the bank partnership funds are lent at prevailing commercial rates with the district subsidizing 1 percentage point of the interest to reduce the effective burden on borrowers. Both funding streams are repayable on a one-year grace period followed by equal installments over three years.
Businesses and small business owners wishing to apply may do so from Aug. 24 through Sept. 10 by first consulting with one of the district's partner financial institutions — Shinhan Bank, Industrial Bank of Korea, Woori Bank or Hana Bank — and then submitting the required documents in person to the district office's local economy division.
The district plans to convene its fund management review committee in September to finalize loan recipients and disburse funds in October. Full details on application procedures and required documents are available on the Seongdong-gu website under the "News" section.
"I hope this loan support gives small and medium-sized enterprises and small business owners who are struggling with the economic slowdown and high interest rates some breathing room and real help in keeping their businesses on stable footing," district mayor Yoo Bo-hwa said. "We will continue to look closely at the difficulties businesses face on the ground and put in place support that they can truly feel."
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