Shinbo-Gyeongbuk Province Supports COVID-19 Affected Companies with 3 Million KRW in Accounts Receivable Insurance Premiums

[Asia Economy Reporter Kim Min-young] The Korea Credit Guarantee Fund (KODIT) announced on the 10th that it has signed a "Trade Credit Insurance Premium Support Agreement" with Gyeongsangbuk-do Province and the Gyeongsangbuk-do Economic Promotion Agency to help small and medium-sized enterprises (SMEs) located in Gyeongbuk overcome crises and stabilize management amid difficulties caused by the novel coronavirus disease (COVID-19).

Under this agreement, Gyeongbuk Province will contribute 1 billion KRW to KODIT to support 50% of the trade credit insurance premiums, up to a limit of 3 million KRW per company, and KODIT will offer a 10% discount on the premiums. The Gyeongsangbuk-do Economic Promotion Agency plans to support business promotion and consultations to activate trade credit insurance subscriptions.

The support targets SMEs with headquarters or main business sites in Gyeongbuk that belong to industries eligible for trade credit insurance, such as manufacturing and wholesale/retail. In particular, companies affected by COVID-19 will be given priority for premium support. The insurance product related to this agreement will be available for subscription starting from the 20th, when Gyeongbuk Province's contribution is completed.

Trade credit insurance is a public insurance system operated by KODIT under the commission of the Ministry of SMEs and Startups to support small businesses. When an insured SME sells goods on credit to a client and fails to collect payment, KODIT compensates up to 80% of the loss incurred. KODIT has expanded the underwriting scale of trade credit insurance by 200 billion KRW to prevent the spread of damage to SMEs caused by COVID-19.

Yoon Dae-hee, Chairman of KODIT, said, "We expect this agreement to resolve difficulties faced by SMEs located in Gyeongbuk due to COVID-19 and to serve as an efficient support policy for regional economic recovery," adding, "KODIT will also do its best to ensure the prompt stabilization of affected companies through active support."

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