Cooperative Foundation Presents Appreciation Plaque to LG Electronics for Excellence in Win-Win Payment Program

LG Electronics and Partners Collaborate to Expand Win-Win Payment System
Improving Payment Environment for Secondary and Lower-Tier SMEs through Win-Win Payments

(From left) Kim Byung-su, LG Electronics Manager, Kim Soon-chul, Secretary General of the Cooperation Foundation, and Koo Ja-chun, CEO of Shinsung Delta Tech, are posing for a commemorative photo.

[Asia Economy Reporter Kim Cheol-hyun] The Foundation for Cooperation between Large, Small and Medium Enterprises and Agriculture and Fisheries (Secretary General Kim Soon-chul, hereinafter referred to as the Cooperation Foundation) announced on the 21st that it awarded plaques of appreciation to LG Electronics and its partner company Sinseong Delta Tech to promote the spread of best practices of the 'Win-Win Payment System' that has been promoted since 2015.

This award ceremony was held to improve the payment environment of small and medium-sized enterprises by expanding the cash liquidity and payment safety of partner companies and to discover exemplary cases of win-win payments.

Since LG Electronics introduced the win-win payment system in June 2015, it has paid approximately KRW 39.2877 trillion through win-win payments to second-tier partners from first-tier partners until the end of last year, and in the past year alone, about KRW 531.7 billion was paid to second-tier partners by first-tier partners, practicing win-win cooperation through a practical trickle-down effect. This is regarded as one of the top 10 companies operating the win-win payment system that made the greatest efforts to create a safe payment environment with partner companies.

In particular, all 88 member companies of the LG Electronics Partner Association (Entrusted Company Council), which are first-tier partners, have completed the introduction of the win-win payment system and are currently operating it, and the win-win payment performance is reflected in partner companies' regular evaluation items and win-win fund subscription conditions to expand to second- and third-tier partners. Sinseong Delta Tech, a first-tier partner, has been using the win-win payment system since 2015 to pay delivery fees to second-tier partners. Last year, about 80% of the delivery fees received from LG Electronics were paid to second-tier partners through the win-win payment system. This is the largest scale among LG Electronics' partners.

The win-win payment system guarantees partner companies cash payment on the payment date and allows early cash conversion at a low interest rate. The delivery fees are separately stored in a deposit account (Cooperation Foundation) and paid directly to the partner companies on the payment date. Even if the purchasing company goes bankrupt, the payment can be safely recovered, and when converted to cash early, the low interest rate applied to purchasing companies (large corporations and public institutions, etc.) can also be enjoyed by lower-tier partners, helping to secure cash liquidity.

Kim Soon-chul, Secretary General of the Cooperation Foundation, said, "The win-win payment system strengthens the survival ability of companies by solving the problems of existing payment methods, thereby reducing the risk of bankruptcy and shortening the payment period," adding, "To expand the win-win payment system, clear incentives such as preferential policy support and tax audit deferrals are needed to encourage many companies to participate."

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