In the future, small and medium-sized enterprises will also be able to benefit from the bank debt adjustment program, allowing them to repay business loans over a maximum of 10 years. The debt adjustment support target for small business owners who are closing down will be expanded from individual business owners planning to close down to those who have already closed down.
On the 24th, the Korean Federation of Banks announced a plan for financial support for small business owners that includes this content. Although no loan arrears have occurred yet, banks plan to support a customized debt adjustment program for small business owners facing difficulties in loan repayment.
Previously, only individual business owners could receive long-term installment repayment benefits, but the banking sector has expanded the program support targets to corporate small business owners. Corporations that meet the conditions of having sales of less than 2 billion won in the previous year, total assets of less than 1 billion won, and bank loans of less than 1 billion won will be eligible. The banks will extend the repayment period of existing business loans to a maximum of 10 years and will also reduce some interest rates as part of the measures.
In addition, the banks will offer low-interest, long-term partitioning programs for small business owners who are closing down. Those planning to close as well as individual business owners who have already closed down can apply for long-term partitioning if they are making regular repayments on their business loans. The maximum term will be up to 30 years, with a uniform grace period of 2 years.
The banks are set to implement these financial support programs for small business owners in April. The application period will be three years from the date of implementation. Starting from the 27th of this month, each bank branch will also provide preliminary consultations related to the program.