Executive Director Yoo Young-ho of the Yellow Umbrella Mutual Aid Fund Division of the Korea Federation of Small and Medium Business(Kbiz).(Photo:Kbiz)

Executive Director Yoo Young-ho of the Yellow Umbrella Mutual Aid Fund Division of the Korea Federation of Small and Medium Business (Kbiz), boasted that they will expand the membership of the Yellow Umbrella Mutual Aid Fund substantially with a strengthened mouth-to-mouth campaign.

At a brief meeting with reporters at the Korea Federation of Small and Medium Business building in Yeouido, Seoul, on July 27, he said the membership target is 150,000 members and the best way to boost the membership is a word-of-mouth campaign.

The Yellow Umbrella Mutual Aid Fund is for small business enterprises and businessmen to prepare for difficult times they might have in the future, such as going out of business or life after retirement, by saving money on an installment basis. They can use the money to either restart their business or safeguard their retirement.

The system got started in September 2007 based on the Korea Federation of Small and Medium Business Law that went into force in 2006.

In eight years since its launch, the membership rose to 580,000, with total savings boosted to 3.3 trillion won. When the owner of a small business firm goes bankrupt, he or she will have three million won in annual income deducted from taxes in consideration of their situation. 

Yoo said it was the SMEs who got hurt the most from the MERS outbreak, and Kbiz will cut the payment rate of the recoupment funds in the second half to 0.5 percent per annum. Kbiz will maintain current payment levels equal to the first half in order to help SME members regain the stable footing they once had before the communicable disease hit the country. 

Yoo also revealed that the new members of the club get a shopping bag and a 10,000 won coupon for markets from July 15 under the K-biz program to help traditional markets and domestic farms by buying their produce. K-biz has also been giving discounted hotel room coupons to some 1,000 members of the Yellow Umbrella Mutual Aid Fund so they can stay at one of six resorts around the country. 

Small and medium-sized businesses are the root of the economy and account for 99 percent of the number of enterprises and 88 percent of all employees. They play a pivotal role in the national economy.

Korean SMEs have improved their competitiveness and cultivated overseas markets through endless technology development and management innovation. As a result, Korea has established the foundation to develop into the world’s ninth-biggest trading nation with trading volume exceeding $1 trillion.

Kbiz was established in 1962 under the objective to improve the economic status and support equal opportunities for Korean SMEs. 

“We have actively dealt with the rapidly changing global economy through making proposals on governmental policies and seeking various systems, while also providing support so that SMEs can enhance competitiveness,” they said. “Also, we supported overseas marketing through participating in foreign exhibitions for SMEs, dispatching overseas business delegations, and providing information concerning FTA. There are about 30 institutions from 17 countries that signed cooperation agreement with us, and we have worked aggressively to enter into overseas market for SMEs through various cooperation projects.”