Mubo Provides Emergency Liquidity Support for Overseas Subsidiaries of SMEs Amid COVID-19

4th Emergency Economic Meeting 'Measures to Boost Export Vitality' Follow-up... Rapid Provision of Working Capital Loan Guarantees
Joint Support for Large Corporations and SMEs/Medium-sized Enterprises Entering Overseas Markets Together... Partnership with Shinhan Bank

Lee In-ho, President of Korea Trade Insurance Corporation (left), and Jin Ok-dong, President of Shinhan Bank, pose for a commemorative photo after signing a business agreement at the K-SURE headquarters in Jongno-gu, Seoul, on the 10th. (Photo by Korea Trade Insurance Corporation)

[Asia Economy Reporter Moon Chaeseok] Korea Trade Insurance Corporation (K-SURE) announced that it will provide emergency liquidity to prevent Korean small and medium-sized enterprises (SMEs) from falling into bankruptcy despite profits due to the COVID-19 pandemic.

On the 10th, K-SURE signed a business agreement with Shinhan Bank at its headquarters in Jongno-gu, Seoul, to provide emergency liquidity support for overseas subsidiaries of SMEs and mid-sized companies affected by COVID-19.

The agreement is part of the follow-up measures to the COVID-19 related "Export Vitality Enhancement Plan" announced by the government at the 4th Emergency Economic Meeting on the 8th. It was promoted to swiftly implement emergency liquidity support.

The two institutions will jointly support working capital to ensure that local subsidiaries of SMEs and mid-sized companies, which have expanded overseas along with large corporations, do not halt their overseas operations due to temporary financial difficulties.

When Shinhan Bank recommends SMEs and mid-sized companies that need operational funds for their overseas subsidiaries by utilizing its global network of 157 branches in 20 countries, K-SURE will issue overseas business financial insurance certificates that can be used as collateral for the bank's loans.

These certificates are part of the export support system that compensates financial institutions lending to Korean export companies operating overseas when they incur losses due to non-repayment of principal and interest by the companies.

The two institutions will simplify the loan and guarantee screening procedures and shorten the period to ensure that liquidity supply, which is directly linked to the survival of companies, is provided promptly and appropriately.

K-SURE expects that overseas companies supported by insurance will be able to smoothly obtain working capital loans from banks. It is anticipated that concerns about suspension of overseas operations due to temporary financial difficulties will be reduced.

K-SURE has formed the "K-SURE Emergency Management Task Force" related to COVID-19 and is operating a full-scale trade insurance support system. After first establishing the "COVID-19 Response Task Force (TF)" on February 5, it was expanded and reorganized on the 20th of last month. In addition to supporting working capital for overseas subsidiaries under this agreement, early cash conversion of export receivables and emergency export stabilization fund guarantees are also being implemented.

Lee In-ho, President of K-SURE, emphasized, "This is a time when the role of policy finance is more important than ever to protect the global supply chains and overseas export markets of key industries that our companies have arduously developed. We will expand a rapid support system to ensure that there are no disruptions in the overseas operations of SMEs and mid-sized companies and continue to strengthen cooperation with related organizations."

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