Korea Credit Guarantee Fund and IBK to Provide 610 Billion Won in Preferential Guarantees for Regional Companies
The Korea Credit Guarantee Fund and IBK Industrial Bank of Korea are set to provide preferential guarantees totaling 610 billion won to reduce the funding burden for companies located outside the Seoul metropolitan area.
On March 24, the Korea Credit Guarantee Fund announced that it had signed a "Financial Support Business Agreement for Regional Balanced Growth" with the Industrial Bank of Korea. The purpose of this agreement is to strengthen the competitiveness of companies based in regional areas by expanding liquidity support and easing their financial burdens. According to the agreement, the Industrial Bank of Korea will contribute a total of 25.7 billion won to the Korea Credit Guarantee Fund, consisting of 23 billion won in special contributions and 2.7 billion won for guarantee fee support. The Korea Credit Guarantee Fund plans to use these funds to provide guarantee services worth a total of 610 billion won under the agreement.
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The support targets companies located in non-metropolitan areas, including those operating in new growth engine industries, exporters and overseas expansion companies, and promising startups. Through the special contribution agreement guarantee, the Korea Credit Guarantee Fund will apply a 100% guarantee ratio for three years and provide a 0.3 percentage point reduction in guarantee fees. For the guarantee fee support agreement guarantee, the fund will offer an annual 0.6 percentage point reduction in guarantee fees for three years to help lower companies' financial costs. A representative from the Korea Credit Guarantee Fund stated, "We hope this agreement will help local small and medium-sized enterprises secure smooth liquidity and create a stable management environment," adding, "We will continue to contribute to balanced regional growth by expanding region-specific financial support through ongoing cooperation with related organizations."
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