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IBK provides funds for SMEs hit by China’s travel ban

State-run lender Industrial Bank of Korea said it will provide a total of 100 billion won ($87 million) in special loans for small and medium-sized enterprises whose businesses have been hurt by China’s latest restrictions on travel to South Korea.

An SME can apply for up to 300 million won in special loans from the IBK from Wednesday until the end of 2017, and the interest rate will be lowered by up to 1 percentage point, the bank said.

If the company wants to extend the period of borrowing, the bank will not demand payment of the principal during the extended period, which will be limited to a maximum of one year.

The special loan requires a verifiable report from the SME that its business was damaged by China’s restrictions on travel to South Korea.

China is putting economic pressure on Korea over the deployment of a US anti-missile system in South Korea meant to counter North Korea’s threats.

While about half of 17.2 million visitors to Korea in 2016 were Chinese. SMEs in the tourism, accommodation and transportation industries are expected to be the first hit by the travel ban, according to news reports.

By Kim Yoon-mi (