Chairman Kim Soon-chul of the Korea Federation of Credit Guarantee Foundation said the business environment for the average person should be improved drastically to spur economic growth, as they are the root of the economy.
In order to improve the business environment for the average person, the credit guarantee limit should be increased and interest rates on loans reduced so that their financial burden may be lightened.
On May 13, Chairman Kim observed his first month in the office a media briefing at his office in Yeouido, Seoul.
When the average person’s life gets better, the economy improves in stop, “which is why we try to lower the thresholds of KOREG’s outlets nearest to them, for them to come to them as often as they can,” he said.
KOREG has an annual budget of 490 billion won to support its operations, including the issuance of re-guarantees to regional KOREG’s, a study on credit guarantees, credit checks and the development and supply, among others.
Chairman Kim said the guarantees issued by the three credit guarantee organizations, including the Korea Credit Guarantee Fund, Korea Technology Guarantee Fund and KOREG, totaled 74.8 trillion won and over 1.039 million cases, out of which KOREG’s came to 14.450 trillion won for 757,000 cases. KOREG issued 60 percent of its credit guarantees with less than 30 million won per case, showing that most of its customers are SMEs. Kim said KOREG feels more pressure to see that those small business firms do well, as their well being is directly related to the soundness of the national economy.
The chairman said the foundation plans to display the interest rates of nation-wide commercial banks on the foundation’s homepage, so that the average person can have a choice on interest rates.
With a slowdown in global economic growth due to the worsening instability of the banking sector that is attributed to the Euro-zone financial crisis and the credit rating lowering for the U.S.A. and Japan, the Korean economy in 2011 has suffered from weakening domestic consumption and the ensuing economic slowdown has caused considerable distress as well as financial hardship to key clients or small and micro enterprises.
“To overcome these difficulties, we at the Korean Federation of Credit Guarantee Foundations (KOREG), supplied 6.1 trillion Won worth of credit guarantees to small and micro enterprises through our 16 regional credit guarantee foundations (CGFs),” KOREG said. “We have also developed customized guarantee products which reflected the characteristics of each region, offering a guarantee balance of 13.6 trillion Won and a re-guarantee balance of 6.9 trillion Won. As a result of these efforts, we were able to resolve the financial difficulties of small & micro enterprises, significantly contributing to the revitalization of regional economies.”
“In addition, we not only have enhanced our client service by increasing the utilization of a government-furnished information network and electronic financial transaction documents and by simplifying credit guarantee application documents, but worked to improve the credit guarantee system to ease the burden on customers,” KOREG added. “We have also reinforced risk management by installing a sound credit guarantee operating system along with the renovation of the electronic credit guarantee system and the activation of electronic commerce credit guarantee.”
Various economic uncertainties are inhibiting the nation’s economic growth to a considerable extent. “In that context, we at KOREG will continue to actively support our regional credit guarantee foundations (CGFs) so that they will keep growing as credit guarantee organizations specialized in small and micro enterprises without ever being content with what we’ve achieved so far.”
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