The extension of the loan principal repayment maturity and interest repayment deferral measures for SMEs and small business owners affected by the novel coronavirus infection (Corona 19) will be re-extended until the end of September this year.
The Financial Services Commission announced on the 2nd that it has decided to extend the loan maturity and delay the repayment of interest for another six months.
Dae-young Kwon, head of the Financial Industry Bureau of the Financial Services Commission, said, “The prolonged Corona 19 has caused difficulties for SMEs and small business owners, and when considering the deferred interest repayment results, we considered the fact that the financial sector is not burdened.”
“In the case of delayed interest repayment, which had a negative current in the financial sector, the scale (163.7 billion won) is not large, and most of the borrowers are voluntarily repaying it,” he explained.
Support for extension of maturity and deferred interest is limited to small and medium-sized businesses and small business owners who have suffered direct or indirect damage from Corona 19, and there is no delinquency such as delinquency of principal and interest, capital encroachment, and closure of business.
Small and medium-sized businesses or small business owners who have previously applied for an extension of maturity or deferred interest repayment can also apply again when the loan maturity within the extended period returns.
Even after the grace period is over, the borrower can choose a long-term or partial repayment plan that suits the situation according to the ‘5 principles of soft landing support’.
The five principles are: providing consulting on repayment plans of financial companies, allowing extension of maturity if the remaining maturity is shorter than the grace period, non-imposition of interest on the repayment deferred interest, early repayment without interim repayment fees, and determining the method and period of repayment by the borrower.
Policy financial institutions (Korea Development Bank, Export-Import Bank, Industrial Bank of Korea, Credit Guarantee Fund, etc.) will also extend maturity and postpone interest repayment for loans and guarantees of SMEs and small business owners whose maturities return within September 30 this year.
The maturity of the secondary preservation loan programs for small businesses operated by 14 commercial and regional banks will also be extended by one year.
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