Yongin City and IBK Industrial Bank Join Hands to Support SME Funding

City loan interest 2%, Industrial Bank guarantee fee 1.2% support
Up to 200 million KRW loan extended up to 3 years... 75 companies benefit

Yongin City in Gyeonggi Province and IBK Industrial Bank of Korea have joined forces to support local small and medium-sized enterprises (SMEs) struggling with financial difficulties.

On the 26th, Yongin City announced that on the 24th, it signed a business agreement with IBK Industrial Bank of Korea at the city hall reception room to assist local SMEs with operating fund loans of up to 200 million KRW. About 10 officials from both organizations, including Lee Sang-il, Mayor of Yongin, and Choi Kwang-jin, Vice President of IBK Industrial Bank, attended the signing ceremony.

Lee Sang-il, Mayor of Yongin (left), and Choi Kwang-jin, Vice President of IBK Industrial Bank, are holding up the agreement document at the business agreement ceremony for supporting small and medium-sized enterprises.
[Photo by Yongin City]

Through this agreement, the two organizations will provide new funding support to reduce the financial burden on SMEs facing difficulties due to high interest rates and economic slowdown, separate from existing special guarantee or secondary interest subsidy support projects.

Under this agreement, IBK Industrial Bank will raise a total loan fund of 45 billion KRW over three years, 15 billion KRW annually, to help SMEs in Yongin receive loans of up to 200 million KRW. To this end, IBK will cooperate with the Korea Credit Guarantee Fund, Korea Technology Finance Corporation, and Gyeonggi Credit Guarantee Foundation to issue guarantees and support guarantee fees up to 1.2%.

The city plans to support 2% of the loan interest for SMEs that receive loans. To provide this support, the city secured a budget of 200 million KRW through supplementary budgeting and plans to invest 900 million KRW over three years.

The support targets companies with headquarters or business sites in Yongin City. Loans can be extended up to three years, and the interest supported by the city will also be provided during the loan extension period. Companies wishing to apply can consult for loans at any IBK branch and then submit the application form and required documents to the city. Detailed information can be found from the 30th on the city’s website under the public notice section or at IBK Industrial Bank branches.

Mayor Lee said, "I thank IBK Industrial Bank for proposing the co-support project to assist Yongin’s SMEs," adding, "I hope this support will help SMEs overcome their difficulties." He also noted, "Since the announcement of the Yongin Advanced System Semiconductor National Industrial Complex, nearly 400 companies have either moved in or wish to move into Yongin," and added, "This agreement will be a great help to those companies."

Vice President Choi said, "Through this agreement, I hope to create an opportunity for the city, the bank, and companies to grow together and generate good synergy," and added, "I will personally ensure diverse cooperation such as financial support and consulting for Yongin’s companies beyond this agreement."

Meanwhile, Yongin City plans to support a total of 55 billion KRW in operating funds this year for stable management of SMEs. This includes the 'SME Special Guarantee,' where the city guarantees up to 300 million KRW per company for those without collateral or with low credit facing temporary financial difficulties, and the 'Secondary Interest Subsidy Support Project,' which reduces loan interest burdens by supporting 2% annual interest for three years on operating funds loaned by the city.

Support is also provided for 'accounts receivable insurance premiums' to prepare for cases where SMEs supply goods or services on credit to clients but fail to collect payments. The Korea Credit Guarantee Fund offers a 10% discount on the insurance premium, and the city supports 20% of the calculated premium up to 2 million KRW. Additionally, SMEs located in the city can receive further insurance premium support from Gyeonggi Province (50%, up to 5 million KRW) and Shinhan Bank (20%).

Furthermore, the city carries out various corporate support activities such as supporting participation in overseas fairs and exhibitions to help technologically advanced SMEs develop overseas markets, improving business site environments for SMEs, and hosting 'visiting corporate briefings' to ensure companies are well informed about the city’s major corporate support policies and national support systems.