노란우산공제 대출National Assembly member Young-deok Yoon (Democratic Party of Korea), a member of the National Assembly’s Political Affairs Committee, received status data on the Yellow Umbrella Deduction for the past five years from the Ministry of SMEs and Startups.
Since its launch in 2007, the Yellow Umbrella Mutual Aid System has grown significantly in scale through various benefits to protect small business owners, such as raising lump sums, income deductions, and signing up for free accident insurance.
The number of mutual aid subscribers is one in four small businesses and small business owners, which is about 40,000 more than the total members of the five major mutual aids compared to other mutual aids.
The number of small business owners seeking money saved through the Yellow Umbrella Deduction due to financial difficulties is increasing every year.
Subscribers who are not in arrears with their mutual aid contributions can utilize a loan up to 90% of the voluntary surrender refund, with a loan period of 1 year (extendable) and a loan interest rate of 3.8%.
Looking at the number and amount of Yellow Umbrella Deduction contract loans by year, 151,957 cases/KRW 1.5602 trillion in 2019, 207,463 cases/KRW 2.3439 trillion in 2020, 297,777 cases/KRW 3.4877 trillion in 2021, By 2022, there are 373,834 cases, KRW 4,712.1 billion, and by July 2023, there are 308,065 cases, KRW 3,955.7 billion.
The number of small business owners extending their loans because the one-year loan period is not enough is also increasing. In 2019, 37,679 cases amounted to KRW 369.7 billion, in 2020, 53,580 cases amounted to KRW 572.1 billion, in 2021, 64,753 cases amounted to KRW 740.1 billion, and in 2022, 41,061 cases amounted to KRW 539.6 billion.
The number of small business owners receiving mutual aid contract loans due to financial difficulties is increasing every year.
In addition, the situation is more serious and the number of small business owners who are canceling their contracts early because they cannot afford to pay the yellow umbrella deduction is increasing. 32,153 cases, KRW 183.9 billion in 2019, 30,218 cases, KRW 180.5 billion in 2020, 30,952 cases, KRW 168.9 billion in 2021, 44,295 cases, KRW 274.2 billion in 2022, 39,018 cases by July 2023 A total of 176,636 contracts worth 1.0715 trillion won were canceled over the past five years, amounting to 264 billion won.
Meanwhile, while loans to small business owners and the self-employed have increased significantly since COVID-19, the delinquency rate, which had been maintained at a low level, is increasing due to worsening economic conditions such as high interest rates and economic slowdown. Accordingly, there are concerns that the accumulated latent insolvency of self-employed people may become actualized in a short period of time.
Representative Yoon Young-deok said, “Even though rumors of a crisis are spreading as the COVID-19 maturity extension and repayment postponement measures are starting to be phased out starting this month, the financial authorities are complacently responding by saying that there is a plan for a soft landing.” He added, “Yellow Umbrella, which serves as a support for small business owners. “Financial authorities must come up with measures to maintain deductions,” he said.
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