Korea Federation of SMEs, Lotte Card team up to widen access to small-business safety net

The Korea Federation of SMEs signed an MOU with Lotte Card on Wednesday at its Yeouido headquarters in Seoul to expand enrollment in the Noran Usan ("Yellow Umbrella") mutual-aid program for small businesses and self-employed workers.

Under the agreement, the two sides will build an online enrollment process allowing small-business owners who use Lotte Card to sign up for Noran Usan, and will pursue joint marketing efforts. Lotte Card customers will be able to enroll through links provided via the card's mobile app or by text message.

Lotte Card merchant account holders who have not yet joined Noran Usan will also receive personalized guidance by phone from dedicated consultants. The arrangement leverages the card company's existing touchpoints with small-business customers to broaden enrollment channels for the program.

Noran Usan is a mutual-aid scheme designed to help small-business owners and the self-employed prepare for business closure, retirement or other hardships by supporting livelihood stability and business recovery. Introduced in 2007, the program has surpassed 3.41 million cumulative members as of this month.

Members can receive an income tax deduction of up to 6 million won ($4,380) per year, and contributions earn annual compound interest. Benefit payments are legally protected from seizure.

Qualifying new members who meet certain criteria can receive an additional 10,000 to 30,000 won per month for 12 months through local government "hope incentive" grants. This year, 17 metropolitan and provincial governments and 110 basic local governments are operating the program.