SME Accounts Receivable Insurance Now Available at Bank Counters

Financial Supervisory Service Approves Hana Bank's Dual Role as Accounts Receivable Insurance Agency and Sales Agent

[Asia Economy Reporter Kim Jin-ho] It has become possible for small and medium-sized enterprises (SMEs) to receive guidance on the Korea Credit Guarantee Fund's accounts receivable insurance products at bank counters.

According to financial authorities on the 25th, the Financial Supervisory Service approved Hana Bank's application for dual business registration to act as an agent for accounts receivable insurance solicitation. This is the first case since the Financial Services Commission amended the law last year to add accounts receivable insurance solicitation agency as a dual business for banks to expand support for SMEs.

Accounts receivable insurance is a public insurance system that compensates for losses incurred when SMEs fail to collect payment after providing goods or services. Approximately 20 trillion KRW is planned to be supported this year.

Hana Bank's accounts receivable insurance solicitation agency business is divided into ▲product promotion ▲product consultation and subscription recommendation ▲guidance and issuance of necessary documents. Procedures such as insurance plan consultation, application reception, underwriting review, and insurance approval will continue to be performed by the Korea Credit Guarantee Fund as before.

The financial authorities expect that the solicitation agency service by banks will enhance transaction convenience for SMEs. In the case of Hana Bank, companies using accounts receivable secured loans receive an interest rate discount (0.5 percentage points) when subscribing to accounts receivable insurance.

A Financial Supervisory Service official explained, "We expect that more SMEs will be able to secure compensation for losses caused by the default of purchasing companies, preventing unforeseen damages and enabling stable business operations."

The Financial Supervisory Service plans to actively review and promptly approve dual business registrations for accounts receivable insurance solicitation agencies by other banks in the future. Kookmin Bank plans to apply for dual business registration next month. Shinhan Bank and Woori Bank are preparing to perform dual business operations.

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