In Tae-yeon, chairman of the Korea Federation of Small and Medium Business, holds a meeting at the agency's headquarters in Daejeon in March to discuss ways to revitalize traditional markets. [Korea Federation of Small and Medium Business]
In Tae-yeon, chairman of the Korea Federation of Small and Medium Business, holds a meeting at the agency's headquarters in Daejeon in March to discuss ways to revitalize traditional markets. [Korea Federation of Small and Medium Business]

In Tae-yeon, chairman of the Korea Federation of Small and Medium Business, said Thursday he is actively reviewing additional interest rate cuts for vendors affected by the Homeplus collapse.

In made the remarks at a national audit of agencies under the Ministry of SMEs and Startups, held Thursday at the National Assembly by the Trade, Industry and SMEs Committee.

People Power Party lawmaker Jo Ji-yeon said only 12.5 billion won — 25 percent of the 50 billion won ($37.4 million) emergency business stabilization fund set aside exclusively for small business owners — had been disbursed as of end-September. Jo also warned that strictly applying delinquency standards to Homeplus vendors who had lost liquidity during the retailer's court rehabilitation proceedings would leave struggling businesses without recourse.

Criticism also focused on the interest rates themselves. Jo noted that the emergency business stabilization fund applied to small and medium-sized enterprises hurt by the 2024 Tmon and WeMakePrice crisis carried a fixed annual rate of 2.5 percent, and argued that support for businesses affected by the Homeplus situation should be strengthened to a comparable level. In said he agreed and that his agency was "actively discussing" a rate reduction.

The Ministry of SMEs and Startups cut loan rates starting in July following criticism that policy fund utilization was low. In the third quarter, the annual rate at the Korea SMEs and Startups Agency fell from 3.78 percent to 3.28 percent, while the rate at the Korea Federation of Small and Medium Business dropped from 3.85 percent to 3.35 percent. Rates have since risen this month, however, as deposit rates have climbed.

Earlier, Minister of SMEs and Startups Lee So-young said Oct. 7 that she would actively review lowering the policy fund rate for Homeplus suppliers and vendors to the level applied during the Tmon-WeMakePrice crisis. As of end-September, the Korea Federation of Small and Medium Business and the Korea SMEs and Startups Agency had directly disbursed 12.5 billion won (25 percent) and 13.1 billion won (33 percent), respectively, to Homeplus vendors.


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