KOTEC to Swiftly Provide Special Disaster Guarantees to Flood-Affected SMEs

Visited Cotran in Sancheong-gun to Assess Damage
Up to KRW 500 Million in Working Capital, Fixed Guarantee Fee Rate Applied
Field-Oriented Response for Companies Affected by Heavy Rainfall

The Korea Technology Finance Corporation (KOTEC) will swiftly provide the "Special Disaster Guarantee for SMEs" to small and medium-sized enterprises affected by heavy rainfall.

On July 23, KOTEC announced that it had visited Cotran, located in Sancheong-gun, Gyeongnam, which has been designated as a special disaster area, to assess the damage and review support measures.

Cotran, a technology startup specializing in seafood processing, had achieved rapid sales growth over the past three years, but now faces a crisis due to the recent flood. Part of its factory was submerged and a power outage occurred, forcing the company to urgently transfer seafood raw materials under processing to a cold storage facility in Busan. This has raised concerns about possible delays in its export schedule.

Juseon Park, Executive Director of the Korea Technology Finance Corporation (right), is listening to an explanation of the damage situation from the CEO of Cotran. Korea Technology Finance Corporation

KOTEC plans to help Cotran and other SMEs affected by the heavy rainfall overcome the damage quickly and stabilize their management by promptly providing the Special Disaster Guarantee for SMEs. This preferential support program is designed to ease temporary funding difficulties and support the normalization of management for SMEs affected by natural disasters. Eligible recipients include: companies recognized as disaster-affected SMEs by the government or local authorities; companies that have received decisions for disaster recovery funding support; and companies whose damage has been confirmed through KOTEC’s on-site inspections.

Through this special guarantee, KOTEC will provide up to KRW 500 million in working capital per company and facility funds within the required amount for companies in special disaster areas, applying a fixed guarantee fee rate of 0.1%. For general disaster areas, the combined limit for working capital and facility funds is set at KRW 300 million, with a fixed guarantee fee rate of 0.5%. In addition, KOTEC will minimize the financial burden on affected companies by raising the guarantee ratio, easing screening criteria, and extending the maturity of existing guarantees.

KOTEC will also establish an emergency response team, led by the executive in charge of guarantees, to focus all efforts on supporting companies affected by the heavy rainfall. "Heavy Rain Damage Reporting Centers" will be operated at local branches near the affected areas, and a field response team led by regional headquarters directors will be mobilized to ensure rapid support for affected companies.

Juseon Park, Executive Director of KOTEC, stated, "KOTEC will do its utmost to provide tailored financial support, including special guarantees, so that technology-based SMEs can overcome management crises caused by sudden disasters at an early stage and continue their business operations in a stable manner."