South Korea Rolls Out Support Measures for Small Businesses

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In response to the economic challenges posed by high inflation and interest rates, the South Korean government has unveiled a series of support initiatives aimed at bolstering small businesses across the nation.

Starting next month, eligible small businesses will receive vital assistance in the form of power bill subsidies, with amounts reaching up to 200,000 won ($150). To qualify for this support, businesses must have been established before the end of the previous year and remain operational as of February 15, 2024. Applications for businesses with direct contracts with the Korea Electric Power Corp. (KEPCO) can be submitted between February 21 and April 20, while those without direct contracts can apply from March 4 to May 4.

Furthermore, small business owners are encouraged to enhance energy efficiency within their operations, with support covering up to 40 percent of installation costs for high-efficiency electronic appliances such as heating and cooling systems, washing machines, LED lighting, and refrigerators.

In addition to these measures, the government aims to alleviate the burden of high interest rates by reimbursing small businesses for interest payments exceeding 4 percent, up to 3 million won. Further relief will be provided for interest on loans from savings banks or mutual finance cooperatives with rates of 5-7 percent, reimbursing up to 1.5 million won.

Moreover, plans are underway to enhance the mutual aid system for small business owners, expanding the scope of payment reasons to include various factors such as natural disasters, illnesses, and bankruptcy.

The government’s efforts also extend to revitalising traditional markets, with branding initiatives for historical markets and support for environmental improvements.

These comprehensive support measures underscore the government’s commitment to bolstering the resilience of small businesses and driving economic recovery amidst challenging times.