Financial Authorities Support Timaep Victimized Sellers... Loan Maturity Extension and Repayment Deferral Offered

Up to 1 Year
Liquidity Support from Kieun and Shinbo... Minimum 3.9% Interest Rate
Emergency Management Stabilization Fund Also Supported
"Emergency Response Team Operating"

The government will implement support measures related to the delayed settlement of sales proceeds by TMON and WEMAKEPRICE starting from the 7th. Existing loans can receive a one-year maturity extension and repayment deferral, and liquidity programs and emergency management stabilization funds will be provided by relevant institutions.

The Financial Services Commission, the Ministry of SMEs and Startups, and other related ministries announced on the 28th of last month that they will implement specific support measures to supply liquidity exceeding 560 billion KRW to sellers in response to the ‘TMON and WEMAKEPRICE incident.’ They are also considering expanding the scale of support depending on the future increase in the damage scale.

First, from the 7th, companies that have suffered or are expected to suffer from delayed settlements can receive up to a one-year maturity extension and repayment deferral on existing loans and guarantees. Eligible companies and loans are financial institution (banks, life insurance, non-life insurance, credit finance companies, savings banks, NongHyup, Suhyup, Forestry Cooperatives, Credit Unions, Saemaeul Geumgo) business or corporate loans held by companies with sales after May. Household loans such as mortgage loans and personal credit loans unrelated to business are excluded.

Financial companies will broadly support TMON and WEMAKEPRICE tenant companies that prove sales after May through the seller page on the homepage. Sales facts can be checked on the seller page, and this can be verified at the application window when applying for maturity extension or repayment deferral. Companies can also visit or consult with branches of their financial institutions for guidance.

Banks handling advance settlement loans (KB Kookmin Bank, Shinhan Bank, SC First Bank) will also support maturity extension and repayment deferral to prevent defaults. Applications can be made through branch counters starting from the 7th.

To receive maturity extension and repayment deferral support, there must be no defaults such as principal and interest arrears or business closure. However, for companies that inevitably delayed loan repayments due to unexpected cash flow shortages caused by unsettled payments from TMON and WEMAKEPRICE, support will be provided even if arrears occurred between the 10th of last month and the 7th of this month.

Liquidity programs are also available. Through IBK Industrial Bank and the Korea Credit Guarantee Fund, support is provided up to a maximum of 3 billion KRW within the limit of unsettled amounts. Companies suffering from delayed settlements exceeding 3 billion KRW can use the Korea Credit Guarantee Fund’s general guarantee products or bond collateralized securities (P-CBO) products. Guarantee screening is simplified up to 300 million KRW per company to supply as much as possible, but for amounts between 300 million KRW and 3 billion KRW, some amount restrictions may apply after company-specific limit assessments.

By applying for special guarantees at 99 Korea Credit Guarantee Fund branches nationwide, loans are supported by IBK Industrial Bank after guarantee screening by the Korea Credit Guarantee Fund. Interest rates range from 3.9% to 4.5% (guarantee fees 0.5% to 1.0%), which is 1 percentage point lower than typical SME loan rates. Pre-applications for special guarantees will be accepted starting from the 9th, and actual fund disbursement is expected to begin around the 14th after system preparations.

The Small and Medium Business Corporation and the Small Enterprise and Market Service provide emergency management stabilization funds. Support is provided up to a maximum of 150 million KRW (Small Enterprise and Market Service) and 1 billion KRW (Small and Medium Business Corporation) within the limit of unsettled amounts. The Small Enterprise and Market Service will provide direct loans and supply as much as possible within the damage amount. The Small and Medium Business Corporation will simplify screening to provide support.

Small and medium enterprises can receive support through the Small and Medium Business Corporation, and small business owners through the Small Enterprise and Market Service. Support is provided at interest rates of approximately 3.4% and 3.51%, respectively. Applications can be made from the 9th through the SME Policy Fund and Small Business Policy Fund websites, and funds will be disbursed after screening. Early closure may occur if the budget (200 billion KRW) is exhausted.

The Financial Services Commission, the Ministry of SMEs and Startups, the Financial Supervisory Service, policy financial institutions, and sectoral associations have formed an emergency response team and are closely consulting. The counseling center operates consultation windows for each institution under the overall management of the Financial Supervisory Service’s SME Financial Difficulty Counseling Center, providing consulting on fund support and receiving difficulties. Each institution has a dedicated team to prevent overlapping support of special funds after the launch of fund support programs. For companies with damage amounts exceeding 100 million KRW, close support will be provided through policy financial institutions and others.