$400 million in aid for South Korea amid e-commerce crisis

South Korea is to provide $400 million in financial support to small businesses affected by payment delays on two e-commerce platforms, Qoo10, a move that follows a pledge by the Singapore-based company’s founder to use his own assets to compensate customers and suppliers.

Seoul-based TMON and WeMakePrice recently filed for corporate rehabilitation after failing to make payments to merchants since early July, with Qoo10 attributing the problem to a payment system glitch. Some 210 billion won ($152 million) of payments remain unsettled, prompting vendors to cut ties and financial authorities to investigate.

The South Korean government plans to offer low-interest loans to affected companies and extend loan and tax repayment terms. Vice Finance Minister Kim Beom-seok reiterated the government’s commitment to minimizing damage. Similarly, South Korea’s attorney general ordered a special team to investigate.

(Based on information from the agency.)