Gov’t to inject $405 of liquidity for TMON, WeMakePrice incident

Jul 30, 2024, 10:49 am

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First Vice Finance Minister Kim Beom-seok speaks during an emergency task force meeting regarding payment delays by TMON and WeMakePrice at the Government Complex Seoul on July 29, 2024./ Source: Yonhap News

First Vice Finance Minister Kim Beom-seok speaks during an emergency task force meeting regarding payment delays by TMON and WeMakePrice at the Government Complex Seoul on July 29, 2024./ Source: Yonhap News

AsiaToday reporter Lee Choong-jae

The government has decided to extend at least 560 billion won (US$405.5 million) of funds to support small vendors suffering from payment delays by the e-commerce platforms TMON and WeMakePrice. Although their parent company, Singapore-based Qoo10, said it would settle the situation, the government decided to extend support for customers and sellers to minimize the damage amid concerns over bankruptcies among small vendors.

The finance ministry held an emergency task force meeting regarding payment delays by the two South Korean marketplaces at the Government Complex Seoul on Monday, and announced its plan to address the damage caused to consumers, by expediting refund processing, including credit card cancellations while providing liquidity support.

The government has decided to inject at least 560 billion won (US$405.5 million) in liquidity. First of all, it will provide policy loans amounting to 200 billion won to support the affected small businesses and their owners by utilizing the emergency management stabilization fund program of the Korea SMEs and Startups Agency and the Small Enterprise and Market Service. The Financial Supervisory Service (FSS) will provide emergency funds by establishing a new guaranteed loan program worth about 300 billion won through the Korea Credit Guarantee Fund and the IBK. An additional 60 billion won will be available for travel agencies hit particularly hard by the payment delays, according to the ministry.

The government plans to support rapid refund processing such as cancellation of card payments through cooperation with travel agencies, credit card companies, and electronic payment agencies, and induce consumers who bought tickets and travel packages through the websites to receive refunds or use the tickets and services as intended.

Financial regulators will operate complaint desks and accept dispute applications for affected customers in the travel industry from Aug. 1 to 9.

“TMON and WeMakePrice must take responsibility for the payment failure,” the government said. Their unpaid bills came to around 210 billion won, and the amount is expected to swell further, the government estimates.

“The government cannot sit down and watch the situation, and we will extend support for customers and sellers to minimize the damage by mobilizing all possible resources,” First Vice Finance Minister Kim Beom-seok said during the meeting.

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