Korea Eximbank to prioritize SMEs for on-lendingThe Export-Import Bank of Korea, or Korea Eximbank, announced May 20 that it will introduce a program to give preference to small- and medium-sized exporters in overseas on-lending services.
On-lending is an indirect finance product through which Eximbank offers loans to small- and medium-sized enterprises (SMEs) via financial intermediaries, so Korea Eximbank provides funds to intermediaries such as commercial banks, and then the intermediaries lend the money to SMEs.
The financial intermediaries of Korea Eximbank include the Industrial Bank of Korea, Woori Bank, Hana Bank, NH Bank, Shinhan Bank and KB Kookmin Bank.
The program will benefit SMEs in industries related to the Korean New Deal or in up-and-coming export sectors such as cosmetics and digital devices. Also, SMEs with less than 2 billion won ($1.8 million) in annual exports are eligible for the program as well.
For the SMEs meeting the criteria, Korea Eximbank will offer a maximum 10 basis point — 0.1 percent point — reduction in interest rate and a credit line three times higher than in regular on-lending.
The newly introduced program is targeting SMEs that have recently entered the overseas market, aiming to make the bank’s financial products more accessible for exporters in their beginning stage.
In order to apply for the program, companies should visit the intermediaries to look for the product that fits their needs.
“The program is part of an institutional strategy to strengthen support for promising sectors and to boost aid for exporters,” an official at Korea Eximbank said.
“Korea Eximbank is also planning to launch another service to simplify document record of exports and imports via Bank Trade Statistics Service, or Bank Trass, for clients using the overseas on-lending service.”
Korea Eximbank has provided 13.1 trillion won to 5,205 companies since it launched the overseas on-lending service in 2015.
By Shin Ha-nee [email@example.com]