In accordance with the draft FY 2011 first supplementary budget just approved by the Cabinet, the Small and Medium Enterprise Agency (SMEA) has decided to significantly enhance financing assistance measures for small and medium enterprises (SMEs). The Agency will support SMEs severely affected by the disaster either directly or indirectly by establishing disaster response financing programs, aside from existing schemes. The new programs will provide for greater support, such as extended loan limits and lower interest rates.
[Project size: about ¥10 trillion, budget: ¥510 billion]

Aside from existing disaster-related guarantees and safety-net guarantees, a new guarantee program will be established for SMEs severely affected directly or indirectly by the disaster in order to considerably raise the credit guarantee limits and otherwise expand support for them.

Japan Finance Corporation (JFC) will institute a new long-term, low-interest loan program. Shoko Chukin Bank will create a similar loan program as well.

These programs are designed to help SMEs severely affected directly or indirectly by the disaster and will bring greater benefits than the existing programs (disaster recovery loans and safety-net loans) through extended loan limits and periods and application of lower interest rates. In addition, an interest subsidy program whereby interest on loans is reduced to zero through subsidies from the Organization for Small and Medium Enterprises and Regional Innovation, Japan (SMRJ), or the local government will be set up especially for SMEs whose business sites have been completely destroyed or washed away by the earthquake or tsunami.

SMEA will also implement measures to reinforce the financial foundation of JFC (Crisis Response Finance Department), which plays an essential role in providing interest subsidies, as well as security against losses, for loans made by Shoko Chukin Bank.

• Financing Assistance Measures for SMEs (PDF:319KB)

April 28, 2011

Finance Division, Business Environment Department, Small and Medium Enterprise Agency

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