Trade Insurance Corporation, 'Full Effort to Execute Additional 36 Trillion KRW in Export Financing'

Extension of Short-term Export Insurance Limit Without Deduction, Immediate Implementation of 50% Discount on Insurance and Guarantee Fees

Lee In-ho, President of Korea Trade Insurance Corporation. (Photo by Korea Trade Insurance Corporation)

[Asia Economy Reporter Moon Chaeseok] Korea Trade Insurance Corporation (K-SURE), a public institution dedicated to export insurance, began full support for export companies' trade insurance on the 9th to overcome the crisis caused by the novel coronavirus infection (COVID-19). This is an implementation measure of the 'Export Vitality Enhancement Plan' announced yesterday by the government, which centers on 'additional supply of 36 trillion won in trade finance.'

On this day, K-SURE held a management committee meeting and an emergency management task force meeting chaired by President Lee In-ho to establish guidelines for full support of trade insurance to minimize COVID-19 damage.

The K-SURE Emergency Management Task Force is led by the president and includes all headquarters chiefs. It was expanded and reorganized from the existing task force (TF) on the 20th of last month to respond to the emergency economic situation and gather company-wide capabilities.

K-SURE will implement measures such as extending the short-term export insurance limit without reduction, supporting overseas project orders and new industry exports, and offering a 50% discount on insurance and guarantee fees, providing 30 trillion won in support to export companies.

To reduce the burden on export companies, the short-term export insurance premium discount will be expanded from the existing maximum of 35% to 50%, and the export credit guarantee fee discount will be increased from the existing maximum of 20% to 50%.

A K-SURE official said, "In accordance with government policy, we will support export companies to maintain relationships with existing clients and protect market share," adding, "We will extend the short-term export insurance limits for key export markets such as the United States, China, and the European Union (EU) without reduction."

Liquidity will be supplied to small and medium-sized enterprises (SMEs) and mid-sized companies facing financial difficulties. Support will be strengthened through ▲ the introduction of new emergency export stabilization funds (100 billion won) ▲ extension of export credit guarantees (pre-shipment) without reduction ▲ expansion of export receivables early cashing guarantees (700 billion won) ▲ liquidity supply for companies entering overseas markets alongside large corporations.

The newly introduced 'Emergency Export Stabilization Fund,' which simplifies the screening process, will provide rapid support of up to 200 million won per company to SMEs and mid-sized companies. The maturity of the 'Export Credit Guarantee (Pre-shipment)' will be extended by one year without reduction.

The export receivables early cashing guarantee will be expanded from the existing 500 billion won to 700 billion won this year to alleviate the problem of funds being tied up after shipment.

Financial support for SMEs and mid-sized companies entering overseas markets alongside large corporations will be increased to assist in securing working capital through capital increases or direct borrowing by overseas subsidiaries.

The threshold for trade insurance will also be lowered. Special support for companies with low credit ratings and the launch of online trade insurance and guarantees will broaden the use of trade insurance. To this end, special support focusing on technology and growth potential will be expanded, moving away from credit rating-based screening.

Online-based trade insurance and guarantees will be launched to shorten the insurance subscription period (from 5 days to 1 day) and simplify the required documents (from 3 types to none).

President Lee In-ho of K-SURE said, "This is an important time to provide energy for overcoming the crisis to struggling export companies while also seeking opportunities for the re-leap of the export powerhouse," adding, "We will gather company-wide capabilities to ensure thorough and prompt support without gaps."

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