Gyeonggi Provincial Office to provide special unsecured loans (KRW 120 billion) to exporting SMEs in cooperation with Woori Bank; the first of its kind attempted by a local government
– As part of support for SMEs with superb technologies

Case 1: A business in Yongin, Gyeonggi Province, identified only as “W,” succeeded in developing the technology for producing high-output LED chips after six years of efforts but could not secure the funds required for mass production. Finally, the business reached an agreement to borrow USD 35 million from a Japanese business. Still, it needed funds to sustain operations on a day-to-day basis until it receives the Japanese fund. In response to the business’s request, the Gyeonggi Provincial Office decided to lend KRW 5 billion won in consultation with Woori Bank.

As shown in the case above, the Gyeonggi Provincial Office, jointly with Woori Bank, started operating a system for fund support, including the provision of unsecured loans totaling 120 billion won – the first of its kind attempted by a local government – for small-sized exporting businesses in the province and which have superb technology but experience difficulties due to lack of funds.

On March 12, Gyeonggi Governor Kim Moon-soo and Woori Bank President Lee Soon-woo signed at the Gyeonggi Provincial Office an MOU concerning cooperation on the attraction of investment aimed at helping SME exporters experiencing difficulties due to shortage of funds. Based on the MOU, Woori Bank will provide 10 billion won in domestic guarantee funds to help SMEs that need operating funds. Such SMEs will be able to borrow funds at low interest from the bank’s 250 branches in Gyeonggi Province based on the technology-related evaluation by a domestic guarantee institution. The Gyeonggi Provincial Office will lend up to 120 billion won to businesses by matching the KRW 10 billion provided by Woori Bank.

Details such as guaranteeing institutions as well as how to evaluate businesses including the loan rates will be discussed by a joint task force team of the provincial office and the bank. The Gyeonggi Provincial Office expects the loan rates to be set at a level much lower than those for ordinary business loans. Fund supply is forecast to commence in July this year through the decision of the task force team.
(Information on matters such as loan criteria will be provided on the pop-up window in INVEST.GO.KR.)