The financial sector will expand funding for vulnerable institutional sector during the upcoming Lunar New Year holiday. Nearly 95 trillion won will be provided.
According to the Financial Services Commission on the 8th, policy finance institutions will provide a total of 15.2 trillion won in special loans and guarantees before and after the holiday to meet increased funding demand from small and midsize corporations. The support period runs through Mar. 5. Applications are available through branches of Korea Development Bank, Industrial Bank of Korea (IBK), and Korea Credit Guarantee Fund (KODIT).
Korea Development Bank will provide a total of 1.4 trillion won for operating funds after branch consultations and reviews. It will also offer an interest rate cut of up to 0.4 percentage point.
Industrial Bank of Korea (IBK) will support loans of up to 300 million won per corporation for operating funds such as raw material payments and employee salaries and bonuses. For settlement-type funding loans, it will apply an interest rate cut of up to 0.3 percentage point and supply a total of 9 trillion won.
Korea Credit Guarantee Fund (KODIT) will provide guarantees totaling 4.8 trillion won. It will streamline review procedures for currently operating special and preferential guarantee programs and offer favorable terms on guarantee fees, guarantee ratios, and guarantee limits.
Banks also plan to supply a total of 79.6 trillion won before and after the holiday to small business owners and small and midsize corporations. New loans will total 32.2 trillion won, and maturities will be extended on 47.4 trillion won. Preferential interest rates will apply based on transaction contribution and credit rating.
By bank, NongHyup Bank will supply 5 trillion won in new loans and 8.5 trillion won in maturity extensions through Mar. 4, offering interest rate discounts of up to 2.0 percentage points. Shinhan Bank, Woori Bank, Hana Bank, and KB Kookmin Bank will each supply 6.125 trillion won in new loans and 9 trillion won in maturity extensions through Mar. 13, applying interest rate discounts of up to 1.5 percentage points.
Holiday funding will also be provided for traditional market merchants. Korea INclusive Finance Agency (KINFA) will supply a total of 5 billion won in holiday funds through merchants' associations to support demand for purchasing in-season goods ahead of Lunar New Year. Traditional market merchants can take out microloans of up to 10 million won at an annual rate of up to 4.5% through the 13th of this month.