Gyeonggi-do Shortens 'Credit Guarantee Processing' to 2 Weeks to Overcome COVID-19

[Asia Economy (Uijeongbu) = Reporter Lee Young-gyu] Gyeonggi Province and the Gyeonggi Credit Guarantee Foundation are promoting a plan to shorten the credit guarantee processing period to within two weeks to quickly support small and medium-sized enterprises (SMEs) and small business owners economically affected by COVID-19.

According to Gyeonggi Province on the 2nd, since the recent spread of COVID-19, the demand for financial support has increased, causing a surge in guarantee operations at Gyeonggi Credit Guarantee Foundation. The number of consultations per month has increased more than sevenfold compared to last year’s monthly average.

In response, Gyeonggi Credit Guarantee Foundation has formed and is operating a rapid support task force, recruited 173 short-term personnel, and is putting all efforts into guarantee operations. They are also exploring various measures such as easing guarantee screening and non-face-to-face (cyber and telephone) consultations to speed up processing. However, difficulties still remain due to the overwhelming demand.

Accordingly, on the 23rd of last month, the province signed agreements with six major commercial banks including Industrial Bank of Korea, Kookmin Bank, NongHyup Bank, Shinhan Bank, Woori Bank, and Hana Bank, and entrusted the consultation, document investigation, and contract work previously performed by Gyeonggi Credit Guarantee Foundation to the bank branches.

In particular, to focus all capabilities of Gyeonggi Credit Guarantee Foundation on guarantee screening such as limit assessment and guarantee amount determination, on-site inspections have also been entrusted to the banks.

As a result, the province expects the guarantee processing period, which previously took 27 days, to be reduced to within 14 days.

With the expectation that guarantee demand will further increase due to the prolonged COVID-19 situation, the province plans to strengthen cooperation with the central government, Gyeonggi Credit Guarantee Foundation, and banks.

On the 1st, the province held a 'COVID-19 Financial Support Related Agencies Meeting' at the Gyeonggi Credit Guarantee Foundation conference room with related organizations including the Ministry of SMEs and Startups, Gyeonggi Regional Small and Medium Venture Business Administration, Gyeonggi Credit Guarantee Foundation, and banks, agreeing to work together.

Kim Gyu-sik, Economic Planning Officer of the province, said, "Urgent support is desperately needed for residents suffering from COVID-19," and added, "We will work together across institutions to ensure funds are provided more quickly."

The province and Gyeonggi Credit Guarantee Foundation are implementing a special financial support of 200 billion KRW and a guarantee support project worth 3.1 trillion KRW to support SMEs and small business owners affected by COVID-19.