Infrastructure Credit Guarantee Services - KODIT

Infrastructure Credit Guarantee Services

Korea Infrastructure Credit Guarantee Fund (KICGF) was established in August 1994, under the provisions of the 'Act on Private Participation in Infrastructure'. Initially, KICGF was operated by three institutions : Korea Development Bank, Korea Technology Credit Guarantee Fund, and Korea Credit Guarantee Fund (KODIT) . Later, in Jan 1999, KODIT took over the funds of the other two institutions and became the sole operator of KICGF.

The objective of infrastructure credit guarantee services is to help private investment corporations obtain funds for facility construction. Infrastructure credit guarantee services have played a significant role in securing the financing of private investment corporations that lack the collateral for loans but have acceptable credit standings and strong prospects.

Flow of Infrastructure Credit Guarantee Services

 

Procedure

To obtain infrastructure credit guarantee services, the applicant is required to make an application to the Social Overhead Capital (SOC) team of KODIT. The SOC Team carries out credit investigation, decides whether to accept the application and draws up possible guarantee amount, based on the credit standing of the applicant.

Once the application is approved, the SOC team issues a letter of credit guarantee and KICGF assumes the guarantee obligation. The guarantee obligation of KICGF will carry its maturity according to the terms and conditions of the payment.

Flow of Infrastructure Credit Guarantee

 

All companies are eligible for infrastructure credit guarantee services under the   circumstances that their investment plans are approved by the competent authorities. However, foreign companies established by foreign laws cannot apply

The ceiling amount of infrastructure credit guarantee for a single company is KRW 200 billion.

Guarantee fee varies between 0.2% and 1.3% of the total guarantee amount. The fee is calculated based on the project risk and the credit rating of the company.