Implementation Guidelines for Taipei City Government SME Finance Loan Program
Fu-Chan-Ye-Ke-Zhi no. 09830019700 Promulgated on
February 23, 2009
Fu-Chan-Ye-Ke-Zhi no. 09934149100 Amended on
December 2, 2010
Fu-Chan-Ye-Ke-Zhi no. 10132288501 Amended on July
31, 2012
Fu-Chan-Ye-Ke-Zhi no. 10133033800 Amended on
October 4, 2012
1. The implementation guidelines is established by the Taipei City Government (hereinafter City
Government) for the purpose of boosting the economy of Taipei City (hereinafter the City)
and assisting small and medium enterprises to enhance their development by offering them
finance loan if credit guarantee is provided.
2. The competent authority for the guidelines shall be the Department of Economic
Development, Taipei City Government (hereinafter Department of Economic Development).
The funds resource for the Taipei City Government SME Finance Loan (hereinafter the SME
Finance Loan) shall be provided by and the practice implemented by Taipei City’s authorized
Agent Bank (hereinafter Agent Bank).
3. Applicants who meet the below criteria shall be eligible to apply for the SME Finance Loan:
a. Type I: ROC nationals aged above 20 and below 65 years old, holding household
registration in the City and tax file number, and who own small enterprises not requiring
business registration.
b. Type II: Small and medium enterprises or companies registered as companies in the City.
4. The loan maximum for Type I shall be no more than one million New Taiwan dollars
(hereinafter referred to as the same unit—NT dollars), while the loan maximum for Type II
shall be no more than four million.
The application and grant of the SME Finance Loan for the same applicant shall be limited to
only once. However, after repaying all the amount of the former loan, the applicant who runs
business in a normal way and has good credibility in debts and checks may apply another
loan from the Department of Economic Development for the second time.
5. The SME Finance loan is limited for the use of purchasing plant, business premise,
machinery, facility, or as working capitals. The purchase of the above-mentioned plant,
business premise, machinery, and facility shall already be completed in the six months prior
to the date the loan is applied; and the applicant who applies the loan for the working capital
shall be in actual business for at least one year prior to the date when the application is made.
6. The SME Finance Loan period is limited to a maximum of 5 years with a grace period of a
maximum of one year for principal. The principal and interest are to be paid each month.
Except during the grace period, the principal and interest are to be paid back equally each
month.
7. The SME Finance Loan interest is calculated as the total of 1.45% annual floating interest
plus the floating rate of a 2-year fixed deposit in Chunghwa Post Co., Ltd.
8. The Department of Economic Development may adjust and cut interest rate as a subsidy
depending on the economic situation; the related measures of the above-mentioned subsidy
shall be announced by the Department of Economic Development.
The above-mentioned subsidy of interest rate shall be applied by the Agent Bank monthly to
the Department of Economic Development with the information including lender’s monthly
payment list, overdue receivable, and compulsory enforcement.
9. The interest rate subsidy shall be suspended and the Department of Economic Development
shall notify the lender and the loan institution if any of the following happens:
1. Business suspension or close-down,
2. The business place has been moved out of the City, or
3. The lender does not repay the loan principal monthly.
After the suspension of the interest rate, the interest shall be shouldered by the lender; the
lender shall pay back the overpaid interest subsidy.
The lender may reapply for the interest subsidy to the Department of Economic Development
if all of the above-mentioned conditions do not exist any longer.
10. City Government shall assign one hundred million dollars and Small and Medium Enterprise
Credit Guarantee Fund (hereinafter Credit Guarantee Fund) shall assign one hundred million
dollars respectively (together two hundred million dollars) as the required disbursement that
guarantees for implementing the SME Finance Loan (inclusive of the litigation fees). The total
amount of the credit guarantee loan for the SME Finance Loan is two billion dollars. City
Government and Credit Guarantee Fund may raise the amount for the SME Finance Loan
depending on the business if necessary.
11. The required guaranteed disbursement of the SME Finance Loan for Type I application shall be
disbursed by the fund assigned by the City Government, while one half of the disbursement for
Type II application shall be disbursed by the fund assigned by the City Government and the
other half by the Credit Guarantee Fund.
12. Applicant who applies for the SME Finance Loan for the use of purchasing plants, business
premises, machineries or facilities shall require no guarantor.
13. Lenders are required to apply for credit guarantee in accordance with specifications of credit
guarantee fund trust. Lenders with annual turnover of more than NTD 5,000,000 in the
previous year will be given 90% guaranty. Lenders who are in business for less than one
year or with annual turnover of less than NTD 5,000,000 will be given 95% guaranty.
Guarantee fee is charged as 0.5% per annum.
14. The Agent Bank shall not charge extra fees from the applicant except for the guarantee fund
trust fees and necessary credit inquiry fees.
15. For Type I application not requiring business registration, the person in charge of the
business shall apply for the loan; For Type II application, the application shall be applied by
the company.
16. The applicant shall submit all the documents listed in the following to apply for the SME
Finance Loan:
a.
b.
c.
d.
e.
f.
g.
Application form (1 copy)
Photocopy of front and back of identification certificate of person-in-charge (1 copy)
Business plan (1 copy)
Affidavit (1 copy)
Proof of tax registration, and company or business registration (1 copy each)
Comprehensive credit report from Joint Credit Information Center (1 copy), and
Other necessary documents required by the Department of Economic Development.
Applicant may consent and therefore request the Agent Bank to assist to apply for the credit
report mentioned in the former item, but the application expenditure shall be covered by the
applicant.
17. The Department of Economic Development hereby establishes a SME Finance Loan review
board (hereinafter the Review Board) to review the applicant’s qualification, finance structure,
loan purpose, business, business prospect, loan total amount, loan period, and loan grace
period. The Department of Economic Development shall issue a written notification of
verification to the qualified applicants after the Review Board has verified the application. The
qualified applicants shall, within 3 months from the next date when the written notification is
delivered, proceed to apply for the loan to the Agent Bank; otherwise, the notification shall be
of no avail and the applicant may reapply for qualification verification to the Department of
Economic Development.
18. The Review Board shall consist of 9 members in total, while one of them shall be the
convener, who shall be the commissioner of the Department of Economic Development; other
members shall be constituted by one representative from the Department of Economic
Development, Department of Finance, Taipei City Market Administration Office, Credit
Guarantee Fund, and Taipei Certified Public Accountant Association respectively, and two
representatives from the Agent Bank. All members of the Review Board shall hold the
position without remuneration, and all of them shall be present to the meeting of the Review
Board and shall not attend the abovementioned meeting via attendance of a proxy.
19. The Review Board shall convene a meeting once a month. However, if any qualification
review is required, a meeting may be convened from time to time, and representatives from
related units shall be invited to attend the meeting.
20. The resolution of the Review Board shall be passed on the conditions that more than two-thirds
of the members have been present in the meeting, and more than one-second of the attendants
have vetoed to the resolution.
21. Any member of the Review Board shall avoid attending the meeting and shall not undertake the
review whenever:
a. He/she or his/her spouse holds the post/dismisses from the post of the applicant for less than
one year.
b. He/she or his/her spouse is the relative, collateral relative by blood within three generations
of the applicant’s company’s person-in-charge, charter member, director, supervisor, or
management member, or shareholder who owns more than 10 % of the stocks.
c. He/she or his/her spouse shares the business or shares the interest of the business with the
applicant’s company’s person-in-charge, charter member, director, supervisor, or
management member, or shareholder who owns more than 10 % of the stocks. The Review
Board members shall keep all the acquired information confidential
22. Processing of the loan will be terminated immediately should any of the below conditions occur:
a. Total amount of credit guarantee loan has been fully released or that the total of the overdue
guarantee loan and compensatory balance has reached 10% of the total amount of credit
guarantee loan.
b. Total amount of credit guarantee loan in Type I application has reached 10% of the total
amount of credit guarantee loan of this program or that the total of the overdue guarantee
loan and paid amount has reached 2% of the total amount of guarantee loan.
23. Should the applicant have any of the below conditions, the Agent Bank shall stop releasing
the loan and notify the Review Board:
a. Check credit information from the Taiwan Clearing House showed that the applicant has
issued dishonored checks and is currently blacklisted or that the number of dishonored
checks issued and unsettled has reached the limit that can cause the applicant to be
blacklisted.
b. Credit information from the joint credit information center or credit investigation showed
that the applicant has one of the below conditions: the applicant has unsettled principal in
debts, has not repaid the debt in installments for more than one month, as agreed, and has
overdue interests for over 3 months, unsettled credit card balance, or is forced to close
his/her credit card account. Applicant who has settled all overdue debts or credit card
balances is not subject to this clause.
24. The Agent Bank shall handle this loan in accordance with loan review procedures, credit
investigation specifications, and this Implementation Guidelines.
25. The Agent Bank shall keep all information related to this loan properly for future review of the
City Government and Credit Guarantee Fund.
26. SME employers who apply to the service center of the Department of Labor, Taipei City
Government to employ unemployed laborers shall be given NTD10,000 employment subsidy
per unemployed labor per month for a maximum of 12 months.
27. The Department of Economic Development shall establish and regulate for the SME Finance
Loan refusal conditions and the required written forms.