4.5 trillion won in loans supplied to regional companies; principle of foreign exchange loans repayment c

South Korea's Financial Services Commission announced at its sixth Productive Finance Transformation meeting, chaired by Chairman Lee Eok-won, that it will supply 4.5 trillion won in low-interest, guarantee-backed loans to key small and medium-sized enterprises outside the Seoul metropolitan area over three years. The banking sector will contribute 300 billion won in special contributions to the Korea Credit Guarantee Fund and the Korea Technology Finance Corporation, with 16 banks signing a business agreement to support regional companies. The commission also moved to address payment practices, deciding to abolish in principle the repayment claim right on the "oedamdae" (external guarantee loan) program starting January 2027, and to shorten payment terms on trade receivables to within 60 days beginning February 2027. The measures aim to ease financing burdens on non-metropolitan SMEs and improve cash flow in supply chains. Watch for the FSC's detailed implementation guidelines and how banks and the two guarantee institutions allocate the funds.