Daejeon City Supports Small and Medium Enterprises' Accounts Receivable Insurance Premiums... Mitigating Financial Loss Risks

[Asia Economy (Daejeon) Reporter Jeong Il-woong] Daejeon City will support 50% of the accounts receivable insurance premiums for local small and medium-sized enterprises (SMEs).

On the 16th, the city announced that it signed a business agreement with the Korea Credit Guarantee Fund to implement the 'Accounts Receivable Insurance Premium Support Project.'

According to the agreement, the city will cover 50% of the insurance premiums that local companies enrolled in accounts receivable insurance must pay. The maximum support amount per company is up to 5 million KRW.

Through this, companies will be able to secure stable debt collection and expect an increase in sales.

The support targets are SMEs in the manufacturing sector with headquarters or main business sites located in Daejeon. Applications for support can be made through the Korea Credit Guarantee Fund's main phone number or the Daejeon Credit Insurance Center.

Meanwhile, accounts receivable insurance serves as a buffer to compensate for losses incurred when SMEs fail to collect payments after providing goods or services to clients.

In such cases, the Korea Credit Guarantee Fund pays up to 80% of the loss amount.

Park Mun-yong, head of the city's Enterprise Startup Support Division, said, “The accounts receivable insurance premium support project is meaningful in that it reduces the financial loss risk for local SMEs due to credit transactions and further promotes market development and expansion of transaction scale. We hope this project helps companies achieve managerial stability and improve profitability.”

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