Gyeonggawon Implements Payment Linkage System for SME Deliveries... 20 Companies Selected for Support

Gyeonggi Province will continue to promote the Gyeonggi Province-type Delivery Payment Linkage System this year, following last year, to support small and medium-sized enterprises (SMEs) in the province struggling due to the global economic crisis and soaring raw material prices.

The Gyeonggi-do Economic Science Promotion Agency announced on the 6th that a total of 82 companies applied for the "2024 Gyeonggi Province-type Delivery Payment Linkage System Activation Support Project," and 20 companies were selected.

The Gyeonggi Province-type Delivery Payment Linkage System is a system that automatically adjusts delivery prices according to fluctuations in raw material prices, significantly reducing the burden on SMEs.

The delivery payment linkage system introduced by the central government adjusts delivery prices based on mutually agreed adjustment conditions when raw material costs, which account for more than 10%, fluctuate within 10%. Gyeonggi Province was the first local government in Korea to introduce this system in April last year.

Front view of Gyeonggi-do Economic Science Promotion Agency

Furthermore, Gyeonggi Province lowered the raw material cost threshold to 5% of the delivery payment and expanded the application scope to all transactions over 50 million KRW.

Labor costs, gas fees, and electricity fees were also included in the linkage targets, and transaction period restrictions were removed to enable more SMEs to receive practical benefits.

This year, 22 consignor companies and 60 consignee companies applied, an increase of 6 and 26 companies respectively compared to the previous year.

Kim Gila, Head of Corporate Growth Division at the Gyeonggi-do Economic Science Promotion Agency, said, "The high competition rate in the second year of implementation seems to reflect the demand of local companies due to the linkage system application criteria being more relaxed than the legal standards." She added, "The agency will select 20 companies this month through quantitative evaluations such as company size and transaction amount, as well as qualitative evaluations including willingness for win-win cooperation, and plans to provide a total of 180 million KRW in market support funds, including up to 30 million KRW and a commendation from the governor in early December."

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