Small Business Loan Refinancing: How to Apply!

Why do small business owners need refinancing?

In this high-interest-rate environment, the difficulties faced by small business owners are increasing day by day. To help small business owners struggling with high interest payments, the government is implementing various support policies. A prime example of this is small business refinancing. This system reduces interest burdens by replacing existing high-interest loans with low-interest loans.

What types of small business refinancing are available?

Small business refinancing can be broadly categorized into two types.

• Credit Guarantee Fund Low-Interest Rate Refinancing Program: This program, run by the Credit Guarantee Fund, provides low-interest loans to small business owners who meet certain conditions.
• Ministry of SMEs and Startups Small Business Refinancing: This program, run by the Ministry of SMEs and Startups and the Korea Small Business Administration, refinances high-interest loans or maturing loans at low interest rates.

How do I apply for small business refinancing?

While the application process varies slightly depending on the program, it generally follows the steps below.

🔗 Types, conditions, and application methods for small business refinancing

1. Check eligibility: Check if you meet the eligibility criteria for the program.
2. Prepare necessary documents: Prepare necessary documents such as your business registration certificate and income verification documents.
3. Apply: Apply online or offline.
4. Review: The bank reviews your application.
5. Loan disbursement: If your application is approved, the loan will be disbursed.

Small Business Refinancing: Tips!

• Compare the two programs: It's best to compare the advantages and disadvantages of each program to choose the conditions most favorable to you.
• Prepare necessary documents in advance: Preparing the necessary documents in advance will save you time.
• Consult with a bank representative: It's advisable to consult with a bank representative to select a loan product suitable for your needs.

Small Business Refinancing: Frequently Asked Questions (FAQ)

• Can I apply even if my credit rating is low?
  • While the credit rating standards vary depending on the program, generally, applications are accepted even with a low credit rating.
• Do I need a guarantor?
  • While a guarantor may be required depending on the program, most applications can be made without one.
• How long is the loan term?
  • Loan terms vary depending on the program; please refer to the program guidelines for details.

Small Business Refinancing: Important Considerations!

• Beware of variable interest rates: Even if you refinance at a low interest rate, if it's a variable-rate product, your interest burden may increase if interest rates rise in the future.
• Develop a thorough repayment plan: Develop a repayment plan in advance and consistently repay your loan.
• Carefully review government support policies: The government offers various support policies for small businesses, so it's a good idea to regularly check for and utilize this information.