Government plans to invest 700 billion won to specially adjust long-term debts for small businesses affected by COVID-19. A new loan program, 'K-Living Support Loan,' will provide up to 1 million won to individuals with low credit scores.
On September 1, the government approved the '2027 budget' during a Cabinet meeting. According to the budget proposal, the support for small businesses, farmers, and vulnerable workers will increase from 10 trillion won this year to 15.4 trillion won next year, an increase of 5.4 trillion won. Of this, support for small businesses will rise from 2 trillion won to 3.5 trillion won.
To alleviate the debt repayment burden on small businesses affected by COVID-19, the government will allocate 700 billion won for special adjustments of long-term debts. Additionally, small businesses not covered by employment insurance will receive 500,000 won per month for three months as childcare support, and a health care program will provide up to 100,000 won for substitute labor costs during health check-ups.
Support will also be expanded to enhance the competitiveness and revenue base of small businesses. The government will issue 24 million coupons offering a 5,000 won discount for using cooperative delivery apps. Eight hundred companies developing essential products in sectors like food and beauty will receive 100 million won each for product development and commercialization.
Support for artificial intelligence (AI) and digital transformation will be strengthened. A new initiative will allow trained individuals to visit small businesses to consult on AI and digital transformation, with a total of 8,000 consultations planned. The follow-up promotion and branding support for the TOPS program, aimed at online sales channels, will expand from 30 to 60 companies.
The support for local and innovative companies to enhance their ideas and provide funding for promotion and commercialization will increase from 534 to 900 companies. The program matching private investment up to three times, with a limit of 200 million won, will also expand from 300 to 450 companies.
To stimulate consumption and expand revenue bases, the issuance of local love gift certificates and Onnuri gift certificates will increase from 29.5 trillion won this year to 30.1 trillion won next year. The government will select 139 new markets and commercial districts based on characteristics and themes, providing up to 5 billion won in support.
The consumer environment in traditional markets will also be improved. The discount rate for digital Onnuri gift certificates in traditional markets will increase from 7% to 10%, and the number of locations receiving safety management packages, including cooling equipment for heat waves, will expand from 80 to 340.
A new 'K-Living Support Loan' will be introduced to prevent low and mid-credit individuals from resorting to illegal moneylending. Eligible individuals, classified in the bottom 50% of credit scores, can borrow up to 1 million won at an annual interest rate of 4.5%. The loan term is 10 years, with early repayment options available.
The total supply will amount to 600 billion won, combining 300 billion won from government finances and 300 billion won from private funds. The government aims to support low and mid-credit individuals in recovering their credit without resorting to illegal moneylending.
Support for farmers and vulnerable workers will also be enhanced. The basic income project for rural areas will expand from 17 counties and 200 billion won this year to 35 counties and 1.2 trillion won next year. The scope of social insurance premium support for labor providers will extend from employment insurance and national pension to include industrial accident insurance and health insurance, with 20% of premiums for these new categories being supported.
The income safety net for low-income households will be strengthened. The government plans to increase the median income standard for next year by a record 6.7%. Consequently, the monthly living allowance for a family of four will rise from 2.08 million won to 2.22 million won, an increase of 140,000 won. The budget for the four major benefits related to basic living security will also expand from 22.4 trillion won to 27.1 trillion won.
The eligibility for disability pensions will be broadened. Starting in July next year, the support target will expand from individuals with severe disabilities (grades 1-3) to include those with grade 3 disabilities. This change will increase the number of beneficiaries from 345,000 to 612,000, with the related budget rising from 907.1 billion won to 1.1194 trillion won.
A new system will be established to provide emergency living support of 300,000 won to crisis households. The related budget for this initiative is 5.3 billion won. The government will also strengthen the system for identifying and supporting crisis households through the provision of essential goods packages.
Through these measures, the government aims to mitigate the 'K-shaped polarization' that has emerged during the growth process and to distribute the benefits of growth to small businesses, farmers, and vulnerable workers.
Park Hong-geun, Minister of the Ministry of Economy and Finance, stated, "We will support growth led by local governments so that small businesses, farmers, and vulnerable workers can equally benefit from growth."
On September 1, the government approved the '2027 budget' during a Cabinet meeting. According to the budget proposal, the support for small businesses, farmers, and vulnerable workers will increase from 10 trillion won this year to 15.4 trillion won next year, an increase of 5.4 trillion won. Of this, support for small businesses will rise from 2 trillion won to 3.5 trillion won.
To alleviate the debt repayment burden on small businesses affected by COVID-19, the government will allocate 700 billion won for special adjustments of long-term debts. Additionally, small businesses not covered by employment insurance will receive 500,000 won per month for three months as childcare support, and a health care program will provide up to 100,000 won for substitute labor costs during health check-ups.
Support will also be expanded to enhance the competitiveness and revenue base of small businesses. The government will issue 24 million coupons offering a 5,000 won discount for using cooperative delivery apps. Eight hundred companies developing essential products in sectors like food and beauty will receive 100 million won each for product development and commercialization.
Support for artificial intelligence (AI) and digital transformation will be strengthened. A new initiative will allow trained individuals to visit small businesses to consult on AI and digital transformation, with a total of 8,000 consultations planned. The follow-up promotion and branding support for the TOPS program, aimed at online sales channels, will expand from 30 to 60 companies.
The support for local and innovative companies to enhance their ideas and provide funding for promotion and commercialization will increase from 534 to 900 companies. The program matching private investment up to three times, with a limit of 200 million won, will also expand from 300 to 450 companies.
To stimulate consumption and expand revenue bases, the issuance of local love gift certificates and Onnuri gift certificates will increase from 29.5 trillion won this year to 30.1 trillion won next year. The government will select 139 new markets and commercial districts based on characteristics and themes, providing up to 5 billion won in support.
The consumer environment in traditional markets will also be improved. The discount rate for digital Onnuri gift certificates in traditional markets will increase from 7% to 10%, and the number of locations receiving safety management packages, including cooling equipment for heat waves, will expand from 80 to 340.
A new 'K-Living Support Loan' will be introduced to prevent low and mid-credit individuals from resorting to illegal moneylending. Eligible individuals, classified in the bottom 50% of credit scores, can borrow up to 1 million won at an annual interest rate of 4.5%. The loan term is 10 years, with early repayment options available.
The total supply will amount to 600 billion won, combining 300 billion won from government finances and 300 billion won from private funds. The government aims to support low and mid-credit individuals in recovering their credit without resorting to illegal moneylending.
Support for farmers and vulnerable workers will also be enhanced. The basic income project for rural areas will expand from 17 counties and 200 billion won this year to 35 counties and 1.2 trillion won next year. The scope of social insurance premium support for labor providers will extend from employment insurance and national pension to include industrial accident insurance and health insurance, with 20% of premiums for these new categories being supported.
The income safety net for low-income households will be strengthened. The government plans to increase the median income standard for next year by a record 6.7%. Consequently, the monthly living allowance for a family of four will rise from 2.08 million won to 2.22 million won, an increase of 140,000 won. The budget for the four major benefits related to basic living security will also expand from 22.4 trillion won to 27.1 trillion won.
The eligibility for disability pensions will be broadened. Starting in July next year, the support target will expand from individuals with severe disabilities (grades 1-3) to include those with grade 3 disabilities. This change will increase the number of beneficiaries from 345,000 to 612,000, with the related budget rising from 907.1 billion won to 1.1194 trillion won.
A new system will be established to provide emergency living support of 300,000 won to crisis households. The related budget for this initiative is 5.3 billion won. The government will also strengthen the system for identifying and supporting crisis households through the provision of essential goods packages.
Through these measures, the government aims to mitigate the 'K-shaped polarization' that has emerged during the growth process and to distribute the benefits of growth to small businesses, farmers, and vulnerable workers.
Park Hong-geun, Minister of the Ministry of Economy and Finance, stated, "We will support growth led by local governments so that small businesses, farmers, and vulnerable workers can equally benefit from growth."
* This article has been translated by AI.
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