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City’s Relief Loans to Help Businesses Resolve Urgent Capital Problems

Taipei City Photo In response to the COVID-19 outbreak’s impact on the domestic industries and economy, the Taipei City Government’s Department of Economic Development (DOED) has become the first government agency in Taiwan to launch relief business loans, and amendments to the Implementation Guidelines for Finance Loan were completed in February 2020.

On March 1, four relief loan measures were announced, and 42 applications have been received since the program was launched 6 business days ago. Furthermore, more than 300 people have approached the city hall or contacted the Taipei City one-stop industry service counter via telephone. The number of loan applications during the first month (March) is expected to surpass 200, helping the city’s businesses to resolve their capital problems as early as possible during the outbreak.

According to a citizen who had recently come to the city hall to apply for a relief loan, Taipei City has launched various relief loans or revitalization measures ahead of other municipalities. In particular, the relief loans commenced in March, providing small and medium enterprises with much-needed cash flow, and as a result the policy has received positive feedback.

The DOED commented that business owners that have applied for Taipei City Government SME Finance Loan Program during the relief period only have to pay a super low interest rate of 1.17% for the first 6 months. The loan is achieved by coordinating with Taipei Fubon Bank to lower the loan interest rate by 0.25% coupled with a 1% interest rate subsidy from the Taipei City Government. Existing loanees will also receive a 1% interest subsidy from the government during the relief period, and if existing loanees are unable to pay back their loans due to operational difficulties, they can also apply to Taipei Fubon Bank for deferred principal or interest payment (up to 6 months).

Also, the most popular loan applications during the outbreak are Easy Loans (accounting or nearly 70% of the applications), designed exclusively to mitigate the impact of the outbreak, indicating that businesses must obtain the necessary cash flow more quickly to sustain their operations. Applicants of small and medium enterprise loans under NT$1.2 million do not need to fill out the business plan, and the review of their applications will be expedited. Besides the 3-month principal grace period, they can also enjoy the benefits of Easy Loans such as reduced interest rate (0.25%) and interest rate subsidy (1%).

DOED Commissioner Lin Chung-Chieh indicated that most of the 42 applications received consist of small to medium wholesalers and retailers (over 40%) followed by the accommodation and catering industry (about 20%). As the outbreak develops, it has exerted varying degrees of impact on different industries in Taipei City; therefore, the agency has launched the four relief loan measures to help small and medium enterprises in the city to resolve urgent capital problems. Business owners requiring assistance may contact the Taipei City one-stop industry service hotline at 02-27208889 or contact 1999 for Ms. Wang (#6627) and Mr. Li (#6682). For more details on the four relief loan measures, please refer to the Financing & Loan in Taipei – Taipei City Government Relief Loans (http://www.easyloan.taipei/?md=index&cl=sk_financing&at=sk_loan). For information on other industry relief and revitalization measures in Taipei City, please refer to the DOED’s COVID-19 Outbreak Industry Relief Section (https://www.doed.gov.taipei/Content_List.aspx?n=9B0A7F00032C8B97).