IBK, Launches 1.3 Trillion Won 'Small and Medium Business Guarantee Program'

Published 28 Apr.2023 14:19(KST)

Kim Sung-tae, President of Industrial Bank of Korea

IBK Industrial Bank announced on the 28th that it will implement a cooperative guarantee program to support small and medium-sized enterprises (SMEs) with a total scale of 1.3 trillion KRW.

This is the first project promoted after IBK Industrial Bank signed an agreement to operate a 'Policy Finance Activation Council' with the Korea Credit Guarantee Fund and the Korea Technology Finance Corporation.

The financial support program consists of 'Long-term, Low-interest Special Funds (750 billion KRW)', 'Pre-restructuring Special Funds (150 billion KRW)', and 'Facility Investment Special Funds (400 billion KRW)' to help resolve management difficulties and strengthen the competitiveness of SMEs.

The Long-term, Low-interest Special Funds ease the financial burden by allowing SMEs to repay only 30% of the principal in installments over five years, support small business owners with long-term loans maturing in 10 years, and reduce interest burdens through additional preferential interest rates.

The Pre-restructuring Special Funds promote business normalization by combining IBK Industrial Bank and guarantee institutions' restructuring programs with new fund support for structural improvements. The Facility Investment Special Funds alleviate financial costs by supporting guarantee fees when providing guaranteed loans for new facility investments, aiming to enhance corporate competitiveness through facility investment.

The bank stated that this business agreement is expected to help ease the financial burden on SMEs and small business owners and address concerns about weakened growth potential due to reduced facility investments.

Kim Sung-tae, President of IBK Industrial Bank, said, "With this business agreement, we can provide more timely and swift policy support to SMEs facing difficulties due to changes in domestic and international economic conditions," adding, "We will continue to collaborate with policy finance institutions to be a reliable financial partner for SMEs."