IBK, 2,150 Ultra-Low Interest Loans Provided on First Day of Simple Guarantee... Tackling Loan Bottlenecks

[Asia Economy Reporter Kwon Haeyoung] As the bottleneck in loans for small business owners and self-employed individuals affected by the spread of the novel coronavirus infection (COVID-19) worsens, IBK Industrial Bank of Korea, entrusted with the screening tasks of the Regional Credit Guarantee Foundation, supplied 2,150 cases of the simple guarantee 'Ultra-Low Interest Special Loan' worth 56.1 billion KRW on the first day alone.

On the 7th, IBK President Yoon Jongwon announced via the social networking service (SNS) Facebook that a total of 57,556 applications amounting to 1.4927 trillion KRW for ultra-low interest loans were received over four business days from the 1st to the 6th.

President Yoon said, "With the electronic connection between IBK and the Regional Credit Guarantee Foundation, processing time has been greatly reduced. Customers who have previously dealt with IBK can complete the application to loan process in about 20 minutes if their documents and requirements are met," adding, "Although the number of applications is still large and execution is somewhat slow, the speed will increase going forward."

IBK is supplying 5.8 trillion KRW in ultra-low interest loans guaranteed by the government. As the screening tasks of the Regional Credit Guarantee Foundation were delayed, causing small business owners to wait about two months to receive loans, IBK has been entrusted to handle the guarantee screening tasks since the day before. On the 6th alone, IBK supplied 56.1 billion KRW to 2,150 small business owners through simple guarantees.

He said, "The number of customers such as small business owners visiting branches has increased 70 times compared to the same period last year, but all our branch employees are doing their best to support affected companies," and added, "I feel sorry for them and also grateful."

President Yoon stated that the key to supporting COVID-19 affected companies is 'speed.' He said, "Switzerland is reportedly providing rapid support by utilizing existing customer information under government credit risk guarantees to reduce moral hazard," and added, "I think if a system is established not only at IBK but at branches of all banks nationwide to support existing small and medium-sized enterprises and small business owners, it could prevent bottlenecks in supporting affected companies, reduce customer inconvenience, and enable more effective screening."

Meanwhile, IBK introduced the ultra-low interest special loan simple guarantee service the day before, which allows one-stop processing of guarantee certificate screening, issuance, and loans at the bank. This is to prevent congestion at counters due to increased consultation demand and to provide prompt consultations. A consultation odd-even system and a non-face-to-face service for prior eligibility verification are also being implemented.