Korea Credit Guarantee Fund Offers 38 Billion Won in Preferential Guarantees to Daegu Strategic Industry SMEs

The Korea Credit Guarantee Fund announced on the 26th that it had signed a "Financial Support Business Agreement for Fostering Small and Medium-Sized Enterprises Engaged in Daegu Metropolitan City's Regional Strategic Industries" with Daegu Metropolitan City and IM Bank. The public, private, and governmental sectors are jointly pushing this initiative to revitalize the local economy by discovering and fostering regional strategic industries in Daegu, building a new-industry ecosystem, and boosting exports.

Under the agreement, IM Bank will contribute a total of 1.5 billion won to the Korea Credit Guarantee Fund. Specifically, this consists of 1.2 billion won in special contributions and 300 million won in guarantee fee support funds. Using this as a funding source, the Korea Credit Guarantee Fund plans to provide agreement-based guarantees totaling 38 billion won. Daegu Metropolitan City will lower financing costs by offering interest subsidies of 1.7 percentage points per year for two years to participating companies. Eligible beneficiaries are small and medium-sized enterprises recommended by Daegu Metropolitan City that fall into one of the following categories: companies engaged in regional core industries, companies engaged in new growth engine industries, and export-oriented companies.

Through the special contribution agreement guarantees, the Korea Credit Guarantee Fund will apply a 100% guarantee ratio for three years and reduce the guarantee fee by 0.2 percentage points. For the guarantee-fee support agreement guarantees, it will support 0.5 percentage points of the guarantee fee for three years to ease the burden on companies. The Korea Credit Guarantee Fund explained that it has been strengthening financial support to build a local growth ladder, noting that it also signed a "Productive Financial Support Package Business Agreement for Revitalizing the Regional Economy" with IM Bank in December last year. A representative of the Korea Credit Guarantee Fund said, "Through this agreement, we hope that small and medium-sized enterprises in Daegu engaged in regional strategic industries will grow into key growth engines for the local industry," adding, "We will strengthen cooperation with local governments and financial institutions to expand demand-oriented financial support and contribute to balanced regional development."