'Small Business Safety Net' Noryanusan... Surpasses 1.5 Million Subscribers

Yellow Umbrella Subscribers Surpass 1.5 Million... 14 Years Since Launch in 2007
Annual Income Deduction Up to 5 Million KRW... Contributions Protected by Law
Targeting 3 Million Subscribers by 2030... Promoting Legal Basis for Welfare Projects

[Asia Economy Reporter Lee Junhyung] The Yellow Umbrella, a public mutual aid system for small businesses and small merchants, has surpassed 1.5 million subscribers 14 years after its launch.

The Korea Federation of SMEs announced on the 16th that the number of active Yellow Umbrella subscribers has exceeded 1.5 million. In its first year of launch in 2007, there were only 4,000 subscribers. However, the number grew to 100,000 in 2011, 500,000 in 2015, 1 million in 2018, and surpassed 1.5 million by the end of last month, continuing its growth trend.

Number of active subscribers and deposit balance of Noryanwoosan.
[Photo by Korea Federation of SMEs]

The Yellow Umbrella is a support system for small businesses and small merchants operated by the Korea Federation of SMEs and supervised by the government. Depending on the paid contributions, subscribers can receive an income deduction of up to 5 million KRW annually, and compound interest is paid. The paid contributions are protected by law and can be used as funds for living stability or business recovery.

Additionally, each local government provides subscribers with a Hope Incentive of 20,000 KRW per month for one year. Due to these benefits, the Yellow Umbrella has been recognized as an essential system that small businesses and small merchants must join while running their businesses.

Previously, since 1990, the Korea Federation of SMEs continuously proposed the establishment of a mutual aid system for small businesses and small merchants to the government and the National Assembly. According to the Federation, there were several difficulties during the introduction process of the system, including the establishment of legal grounds with the enactment of the Small and Medium Enterprise Cooperative Act in 2006.

When preparing for the launch of the Yellow Umbrella, the Korea Federation of SMEs lacked establishment funds and received 4.5 billion KRW in operating expenses from IBK Industrial Bank of Korea to build infrastructure. Public service advertisements were conducted through celebrities’ talent donations. At the time of launch, subscription consultations were only available through mutual aid counselors, so the number of subscribers did not increase easily. However, after signing a business agreement with Hana Bank in 2011, the number of subscribers surged rapidly. Since then, the Federation has succeeded in gaining participation from 15 financial institutions.

The Korea Federation of SMEs plans to strengthen promotions targeting small businesses and small merchants with the goal of reaching 3 million subscribers by 2030. The system will be operated with a customer-centric approach, and various welfare services will be implemented. In addition, they plan to support by developing various services including ▲establishing legal grounds for welfare projects ▲launching new deposit and savings-type products ▲starting credit loans exceeding contributions, and other system improvements.

Kim Gi-moon, Chairman of the Korea Federation of SMEs, said, "I deeply thank the government, National Assembly, and financial institution officials who actively supported the Yellow Umbrella until it was firmly established," and added, "We will continue to do our best to expand subscribers and ensure stable operation so that the Yellow Umbrella can become a representative social safety net for small businesses and small merchants."

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