MSS cuts loan rates and extends terms for Geoje, Tongyeong businesses

The Ministry of SMEs and Startups will expand policy fund support for small business owners and small and medium-sized enterprises in Geoje and Tongyeong, which were declared special disaster zones due to heavy rain damage. It will lower the interest rate on the emergency business stabilization fund and raise loan limits, while also supporting maturity extensions for existing policy fund loans.

The Ministry of SMEs and Startups (MSS) said on the 5th that it held the "2026 1st disaster countermeasure deliberation committee" on the 28th of last month and approved a disaster fund support plan for damaged corporations in the Geoje and Tongyeong areas.

This support was prepared to ease the management burden of corporations in Geoje and Tongyeong, which were declared special disaster zones due to heavy rain on Aug. 21, and to quickly provide funds needed for recovery.

For small business owners and small and medium-sized enterprises that suffered heavy rain damage and received a disaster confirmation certificate, the emergency business stabilization fund "disaster special case" will apply.

For small business owners, the maximum loan limit will increase from the current up to 100 million won to up to 300 million won. The interest rate will be lowered from the current 2.0% to 1.5% for direct loans. For agency loans, a fixed rate of 1.4% will apply reflecting the guarantee fee. The repayment period will also be extended from 5 years to 10 years, with repayment in installments after a 5-year grace period over the following 5 years.

For small and medium-sized enterprises, the emergency business stabilization fund interest rate will be reduced from 1.9% to 1.5%. The loan limit is up to 1 billion won, and the repayment period is 5 years with installments over 3 years after a 2-year grace period.

Corporations in Geoje and Tongyeong that already received the emergency business stabilization fund under pre-special-case terms can change to the preferential terms.

For corporations with existing policy fund loans, special maturity extensions will also be supported. Small business owners can extend the maturity of existing loans by up to one year and defer repayment, while small and medium-sized enterprises can extend the maturity of existing loans by up to three years with a six-month repayment deferral. Interest on loans subject to special maturity extensions must be repaid as normal.

These preferential terms are scheduled to apply from Oct. 1 for small and medium-sized enterprises and from the third week of October for small business owners.

To apply for the emergency business stabilization fund, applicants must report the damage to the competent local government and obtain a disaster confirmation certificate. After that, small business owners should contact the Small Business Integrated Call Center (1533-0100), and small and medium-sized enterprises should contact the SME policy fund dedicated call center (1811-3655).

Minister Lee So-young of the Ministry of SMEs and Startups (MSS) said, "We will make every effort to swiftly execute funds so that small business owners and small and medium-sized enterprises in Geoje and Tongyeong affected by heavy rain can ease their financial burden and quickly regain daily life and business stability."