Due to the spread of the new coronavirus and its effects, some foreigners living in Japan might have stopped or left their business and not have enough living funds.
In this article, we will introduce loan systems that can borrow money for those who need living funds immediately.
Emergency Small Amount Fund
Emergency small amount fund is a loan system in which households in emergency and temporary needs can borrow money. There is a screening for making a loan, but if you pass it, you can receive the money in about a week.
This loan is usually for low-income households, but those who have a shortage of money for a living due to COVID-19 effects also can apply it as a special case.
If you have been forced to stop your business due to the COVID-19 effect, you can now receive loans if you pass the screening.
Target of the Special Loan
The loan is intended for households (not individuals) whose income has decreased due to the impact of the COVID-19.
As this is a temporary loan, those who are considered as impossible to repay the amount may not pass the screening.
Please consider applying it if you are temporarily in need of living expenses as a whole household.
Details of the Loan
Details of the emergency small amount fund are as follows. Some items have been changed to support people whose income has decreased due to the impact of COVID-19.
| Items | Details |
|---|---|
| Loan amount upper limit | Up to 100,000 yen（Up to 200,000 yen for some cases） |
| Deferment period | Within 1 year |
| Repayment deadline | Within 2 years |
| Loan interest | 0% |
| Guarantor | Not needed |
The loan limit is 100,000 yen at maximum. However, if a school is closed and you can not work due to taking care of your children, or if you are a sole proprietor and your income decreased by the impact of COVID-19, you can get a loan up to 200,000 yen.
In the period of deferment, you only have to pay interests. As the emergency small amount fund loan is interest-free, you don’t have to pay principal nor interest in this period. You will start repaying the principal and interest in the redemption period, which comes after the deferment period.
How to Apply the Loan
You can apply for the emergency small amount fund loan at the Municipal Social Welfare Council. Find their website of the Prefectural Social Welfare Council from the following page, and then find the contact information of your Municipal Social Welfare Council from there.
There are required documents for the application. For example:
- Identification documents (such as residence cards)
- Copy of certificate of residence (all family member included, issued within 3 months)
- Passbook (recorded until the day of application)
- Bank seal
- Other documents designated by the Council of Social Welfare
Since the required documents vary from person to person, first contact the Municipal Social Welfare Council by telephone and ask what documents you need to prepare. If the decrease in revenue and payment of tax cannot be confirmed in your passbook, you may need to prepare another document such as payslip, etc.
Also, if there is a document that you cannot prepare for some reason, we recommend you tell your situation to the Municipal Social Welfare Council.
If you pass the screening, the money will be transferred to your bank account within about one week from the application.
General Support Funds (Living Support Expenses)
Living support expense loan of the general support funds is another loan that may be available for those who need support for their living expense.
It is originally a loan system to lend expenses necessary for low-income households to rebuild their lives, but the target has been expanded to households whose income decreased, impacted by COVID-19.
Target of the Special Loan
Households whose income has decreased or whose member has become unemployed because of the COVID-19 effect, are the target of the loan.
If you have become unemployed due to the COVID-19, you may be the main target.
Details of the Loan
Details of the living support expense loan are as follows.
| Items | Details |
|---|---|
| Loan amount upper limit | (Two or more persons) 200,000 yen/m (Single person) 150,000 yen/m |
| Loan period | Within 3 months in principle |
| Deferment period | Within 1 year |
| Repayment deadline | Within 10 years |
| Loan interest | 0% |
| Guarantor | Not needed |
While the emergency small amount fund is a temporary loan, the living support expense is a consecutive loan for a period of up to three months.
To rebuild your life, it is also a condition to receive support from independence consultation support programs.
How to Apply the Loan
You can apply for the living expense loan at the Municipal Social Welfare Council, like the emergency small amount fund loan.
The required documents vary from person to person, but please refer to the following as an example.
- Identification documents (such as residence cards)
- Copy of certificate of residence (all family member included, issued within 3 months)
- Passbook (recorded until the day of application)
- Certificate of unemployment or Notification of discontinuance of business (If you are unemployed or closed your business)
- Registered seal
- Seal registration certificate
- Bank seal
- Other documents designated by the Council of Social Welfare
The documents that can be prepared vary depending on the situation of the person, such as a company employee or sole proprietorship. When you contact the Municipal Council of Social Welfare, tell your situation and discuss what documents to prepare.
Documents like a payslip may be required if the decrease of your income and payment of tax cannot be confirmed in your passbook.
You can receive the money in about 20 days from application, in the case of Tokyo.
Please note that there is a screening to see whether you can repay the amount or not.
Conclusion
Two types of loans could be used for households that need living expenses because of the impact of COVID-19: Emergency small amount loan and living expense loan.
Since both of them have screening, there is a possibility that you will not be able to receive a loan as a result of checking the repayment ability, etc. However, if you are in trouble, it is better to consult once.
For more details and consultation, please contact your Municipal Social Welfare Council.
