Suwon, Visa Partner to Simplify Export Payment for SMEs in Korea First

Suwon City announced Wednesday it will partner with global payment technology company Visa to support simplified export payment settlement for small and medium-sized enterprises, becoming the first local government in Korea to offer such a program.

Suwon Mayor Lee Jae-jun and Patrick Storey, country manager of Visa Korea, signed a memorandum of understanding on "Simplified Export Payment Settlement for SMEs" at Suwon City Hall on Wednesday morning.

Under the agreement, Visa will help SMEs in Suwon receive payment on the same day as export consultations by utilizing the Global Trade Payment Platform (GTPP), a trade payment card settlement platform.

Traditional export payment methods such as telegraphic transfer (T/T) and letter of credit (L/C) have been complex, time-consuming and costly. Exporters were required to submit seven types of trade documents including packing lists, insurance policies and bills of exchange, while both exporters and importers had to pay bank fees.

With GTPP, companies no longer need to submit the seven documents and can receive payment on the day of export consultation, eliminating concerns about international trade fraud or non-payment.

The simplified payment process is expected to increase deal closure rates between buyers and exporters at trade consultation sites. Buyers will also benefit from credit periods offered by credit cards, which is projected to boost export contract rates.

The program is expected to provide SMEs, which have relatively weaker capital bases, with a foothold to compete with large corporations in global markets.