"Preventing Chain Bankruptcies": Ansan City to Support Sales Receivables Insurance Premiums for SMEs

Up to 90% Support for Companies with Annual Sales Under 50 Billion KRW
City to Cover 50% Even After Provincial Budget Is Exhausted

On May 8, the city of Ansan in Gyeonggi Province announced that it will implement a "Sales Receivables Insurance Premium Support Program" to respond to the uncertain global trade environment and reduce the risks faced by small and medium-sized enterprises (SMEs) due to credit transactions.

Sales receivables insurance is a public insurance system in which the Korea Credit Guarantee Fund compensates a portion of the losses incurred when a company sells goods or services on credit to a client and is unable to collect payment.

This support program targets local SMEs with annual sales of less than 50 billion KRW. The insurance premium is subsidized as follows: Gyeonggi Province covers 50% of the premium up to a maximum of 2 million KRW, the city provides an additional 20% (up to 2 million KRW), and Shinhan Bank covers another 20% (up to 4.5 million KRW). As a result, the actual burden on companies is reduced to around 10%.

In particular, the city plans to continuously support 50% of the insurance premium using its own budget, moving away from the previous method of halting support once the provincial budget was exhausted.

However, certain industries such as tobacco, alcohol, and precious metals wholesale are excluded from eligibility. Companies interested in the program can visit the Ansan branch of the Korea Credit Guarantee Fund or the Ansan branch of Shinhan Bank for consultation.

Lee Minguen, Mayor of Ansan, stated, "We expect this support to reduce the receivables collection risk for local SMEs and prevent the risk of chain bankruptcies," adding, "We will continue to support the management stability of businesses through various policies in the future."