Special Loans at 1.5% Annual Interest for SMEs Struggling with Export Due to Soaring Freight Costs... Up to 30 Million KRW

KITA and K-SURE Jointly Support 'Special Maritime and Air Freight Loans' for Small and Medium Exporters
KITA Provides 20 Billion KRW at 1.5% Ultra-Low Interest, K-SURE Halves Guarantee Fees

[Asia Economy Reporter Kim Hyewon] A path has opened for small and medium-sized enterprises (SMEs) struggling with exports due to recent sharp increases in freight rates to receive special loans at an annual interest rate of 1.5%.

The Korea International Trade Association (KITA) and the Korea Trade Insurance Corporation announced on the 7th that they will implement a "Special Loan for Maritime and Air Freight" aimed at supporting small and medium export companies.

Under this special loan support, KITA will provide a total of 20 billion KRW in loans at an interest rate of 1.5% to SMEs whose export conditions have worsened due to the surge in freight rates. The Korea Trade Insurance Corporation will reduce guarantee fees by 50%.

Eligible applicants are KITA member companies that have fully paid their annual membership fees and had export performance of 20 million USD or less last year. When applying, they must submit documents proving maritime or air freight costs for this year, such as Bills of Lading (B/L) or Air Waybills.

The maximum loan amount per company is 30 million KRW, and the loan period is a total of 3 years (2 years grace period, 1 year installment repayment). Selected companies can receive loans based on their own credit by obtaining a loan recommendation letter from KITA and applying through financial institutions cooperating with the association, such as IBK Industrial Bank of Korea, or proceed with loans by attaching a guarantee certificate from the Korea Trade Insurance Corporation.

Kim Byung-yu, Head of Member Support at KITA, said, "Maritime freight rates on the trans-Pacific route rose 2.5 times compared to the previous year at the end of April, and the logistics cost burden on the export industry continues to grow." He added, "We hope this special loan will not only ease the maritime and air freight burden on our export companies but also help sustain the export momentum that has been gaining strength this year through the second half."

Applications for the special loan for maritime and air freight can be submitted through the KITA website from the 14th to the 25th. Selected companies can start loan execution from July 30.