Shin Yong Bo Jeung Gi Geum Supports Insurance Premiums for Local SMEs in Collaboration with Local Governments

775 Companies Enroll in Accounts Receivable Insurance Worth 3.3 Trillion KRW

[Asia Economy Reporter Park Sun-mi] The Korea Credit Guarantee Fund (KODIT) announced on the 9th that 775 companies have signed up for accounts receivable insurance worth 3.3 trillion KRW through the 'Accounts Receivable Insurance Premium Support Agreement Insurance,' which supports insurance premiums for local small and medium-sized enterprises (SMEs) in partnership with local governments.

The 'Accounts Receivable Insurance Premium Support Agreement Insurance' is a product where local governments use funds contributed to KODIT to support accounts receivable insurance premiums for regional SMEs. Accounts receivable insurance is a public insurance system operated by KODIT under the commission of the Ministry of SMEs and Startups. It compensates for part of the losses incurred when a company that has purchased insurance sells goods on credit to a client but fails to collect the payment. SMEs selected as regional support targets receive a 10% discount on premiums from KODIT and more than 50% of the premium up to a limit per company is supported by the local government.

Last year, KODIT signed 'Accounts Receivable Insurance Premium Support Agreements' with a total of 10 local governments. Especially this year, to prevent a chain bankruptcy of local SMEs struggling due to COVID-19 and to reduce the burden of insurance premiums, agreements have continued with Incheon City, Gyeongbuk Province, Daegu City, Yongin City, Seoul City, Gwangju City, Ulsan City, and Busan City.

Yoon Dae-hee, Chairman of the Korea Credit Guarantee Fund, said, “Accounts receivable insurance is an essential product to prevent chain bankruptcies of SMEs and to overcome the economic crisis caused by COVID-19,” adding, “KODIT will strengthen the management safety net for SMEs and expand business agreements with local governments to overcome the COVID crisis.”

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