Gwangmyeong-si Provides Up to 90% Support for Accounts Receivable Insurance Premiums to SMEs

Support Expanded to All Companies with Sales Under 50 Billion KRW

Gwangmyeong City in Gyeonggi Province announced on the 31st that it will support up to 90% of accounts receivable insurance premiums for small and medium-sized enterprises (SMEs) struggling due to the economic downturn.

Accounts receivable insurance is a public insurance system that compensates up to 80% of losses incurred when a company sells goods or services on credit but fails to collect payment due to the buyer's insolvency or default.

To prevent a chain of bankruptcies among companies caused by the economic downturn, the city signed an agreement with the Korea Credit Guarantee Fund in January. According to the agreement, the Korea Credit Guarantee Fund applies a 10% preferential discount on insurance premiums. Gyeonggi Province covers 50% (up to 2 million KRW) of the calculated premium, and the city covers 20% (up to 2 million KRW). In particular, if companies agree to receive insurance payments through a Shinhan Bank account, Shinhan Bank provides an additional 20% support on the premium (up to 4.5 million KRW), allowing companies to receive up to 90% support on their insurance premiums.

The city has also expanded the support target this year from last year's limitation to "manufacturing and wholesale/retail sectors with sales under 30 billion KRW" to "all SMEs in any industry with sales under 50 billion KRW."

Park Seung-won, mayor of Gwangmyeong City, said, "This project will serve as a foundation to prevent a chain of bankruptcies among companies and enable stable growth. We will continue to support local SMEs so that they can grow in a stronger business environment."

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