Seoul Raises Safe Overdraft Account Limit for Self-Employed to 20 Million Won

Seoul's “Safe Overdraft Account” Supplies Second Round This Year

Following 200 Billion Won in First Half, Additional 300 Billion Won Funding Announced

Support Limits Subdivided by Business History, Credit Score, and Sales

The Seoul Metropolitan Government is adjusting the support ceiling for overdraft accounts provided to self-employed individuals who have difficulty accessing institutional financial services, raising the maximum amount to 20 million won. The scope of eligibility will also be subdivided by reflecting factors such as the business history, credit score, and reported sales of each self-employed applicant.

On the 31st, the city announced that it will launch the “Safe Overdraft Account 4th Edition” on September 3, increasing the support limit and introducing more detailed eligibility requirements.

A delivery rider is passing in front of a restaurant in Seoul. Photo by Yonhap News Agency

The “Safe Overdraft Account” is an overdraft account exclusively for self-employed business operators, first launched nationwide by Seoul in 2025, to prevent those unable to access institutional finance from turning to illegal private lending.

Following a supply of 200 billion won in the first half of this year, the Seoul Metropolitan Government will provide an additional 300 billion won in the second round of funding. In particular, reflecting the requests from small business owners to raise the limit, the maximum support per company has been raised from the previous 10 million won to 20 million won, and support brackets have been subdivided based on business history, credit score, and sales figures.

Since launching the first edition in 2025, the Safe Overdraft Account has seen high demand, with applications closing for the first three editions in an average of 38 business days. Through this program, urgent operating funds totaling 600 billion won have been supplied in a timely manner to approximately 60,000 self-employed business operators.

Reflecting feedback from the field, Seoul has significantly improved the support system beginning with the 4th edition. The key features include: subdividing eligibility requirements based on business history, credit score, and sales amount; increasing the maximum support limit per business operator from 10 million won to 20 million won; and allowing previous users of the Safe Overdraft Account to apply again.

Previously, individual business owners who met certain requirements could receive up to 10 million won. Starting with the 4th edition, the support framework is organized into three tiers, comprehensively considering business history, credit score, and reported sales. Additional support is also available for existing Safe Overdraft Account users. Since the maximum limit has been raised to 20 million won, users with a remaining guaranteed balance may apply for an additional amount of up to 10 million won within the total ceiling, provided they meet the requirements.

The loan interest rate is approximately 5.12% per annum. This is expected to significantly ease the financial burden for small and medium credit business owners, who have found it difficult to access overdraft accounts with commercial banks and otherwise had to bear high interest rates of 11% to 19% per annum at savings banks. Additionally, the automated, non-face-to-face review process via the mobile app allows for guarantee approval within one business day, without complicated paperwork or in-person steps, making it faster and more convenient for self-employed individuals in need of immediate funding.

Eligible applicants are small and medium-sized enterprises and small business owners with their place of business in Seoul, who meet the following conditions: at least one year of business history; total sales exceeding 2 million won over the past three months or declared annual sales of at least 10 million won; and a personal credit score of 600 or higher according to NICE. However, support is restricted in the following cases, as determined during the guarantee screening by the Seoul Credit Guarantee Foundation as of the application date: if the applicant has received cash advances on credit cards from four or more institutions, or if the total amount of such advances exceeds 10 million won; if the applicant has taken out loans from three or more institutions established under the “Specialized Credit Finance Business Act” or the “Mutual Savings Bank Act” within the last three months; or if the sum of the outstanding guarantee balance at the Seoul Credit Guarantee Foundation and the requested Safe Overdraft Account support amount exceeds 100 million won.

Applications will be accepted from 9 a.m. on September 3 via the Seoul Credit Guarantee Foundation mobile app until all funds are exhausted. To avoid congestion among applicants, during the first week applications will be processed in five groups according to the last digit of the representative's year of birth. From September 10, anyone, regardless of birth year, can apply.

Park Kyunghwan, Director of Public Welfare and Labor of the Seoul Metropolitan Government, stated, “We will continue to closely monitor changes in demand and management conditions in the field, and will further refine our financial support policies so that self-employed business owners can access appropriate funds whenever needed.”

This content was produced with the assistance of AI translation services.