SMEs ministry cuts rates, extends terms for rain-hit Geoje and Tongyeong firms

The SMEs ministry said Tuesday it will lower interest rates and extend repayment periods on policy loans for small businesses and mid-sized companies in Geoje and Tongyeong, the two areas declared special disaster zones after August's heavy rain.

The support measures, approved at the first meeting of the 2026 disaster review committee on Sept. 28, apply to companies that have filed damage reports and received disaster confirmation certificates. For small business owners, the emergency management stabilization fund's disaster special case cuts the loan rate to 1.5 percent from 2.0 percent, or 1.4 percent for indirect loans that include guarantee fees, and raises the ceiling to as much as 300 million won ($220,832) from 100 million won. Repayment is stretched to 10 years, with a five-year grace period, from five years with two years of grace. Mid-sized companies get the same fund at 1.5 percent, down from 1.9 percent, with a ceiling of up to 1 billion won ($736,106).

Existing policy loans will also be granted special maturity extensions: up to one year with a one-year grace period for small business owners, and up to three years with a six-month deferral for mid-sized companies. The measures took effect for mid-sized companies on Oct. 1 and will be reflected for small business owners from the third week of October. Companies that already drew funds under the previous terms will have their conditions revised to the preferred terms as well.

Geoje and the Sanyang township and Bongpyeong district of Tongyeong were declared special disaster zones on Aug. 21 after intense rain fell from Aug. 15 to 18.

"We will devote all efforts to the swift execution of the funds so that small business owners and mid-sized companies in Geoje and Tongyeong hit by the heavy rain can ease their financial burden and quickly regain stability in their daily lives and operations," SMEs Minister Lee So-young said.

Owners and companies seeking the funds must first report damage to their local government and obtain a disaster confirmation certificate, then apply through the small business integrated call center at 1533-0100 or the policy fund call center for mid-sized companies at 1811-3655.