The number of applicants for the debt adjustment program "New Start Fund" aimed at small business owners and self-employed individuals who have closed their businesses has exceeded 120,000.
The Korea Asset Management Corporation (KAMCO) noted on the 13th that as of the end of last month, the number of applicants for the New Start Fund debt adjustment program stood at 125,738, with an applied debt amount of 20.3173 trillion won.
The New Start Fund is a debt adjustment program introduced in October 2022 to reduce the burden on small business owners and self-employed individuals who have become unable to repay debts due to the impact of COVID-19. It adjusts debts by reducing principal, extending repayment periods, or lowering interest rates. Up to 80% of the loan principal can be waived, and the debt adjustment limit is a maximum of 1.5 billion won per person (collateral 1 billion won + unsecured 500 million won).
In the "purchase-type debt adjustment," KAMCO directly purchases debts from financial institutions, with 33,629 people (debt principal of 29.609 trillion won) signing agreements. The average principal reduction rate is about 70%. In the "brokerage-type debt adjustment," which mediates negotiations between debtors and financial companies to adjust repayment periods, interest rates, and other debt conditions, 37,950 people have confirmed agreements, with an average interest rate reduction of about 4.7 percentage points.