Naver and Woori to offer loans to small online businesses

Naver Financial joined forces with Woori Bank to offer a loan service to small businesses that sell products online.

Woori Bank CEO Kwon Kwang-seok, right, and Naver Financial CEO Choi In-hyuk pose for a photo after inking a partnership to offer specialized loans for small online sellers on Wednesday at Woori Bank's main branch in Jung District, central Seoul. [NAVER FINANCIAL]

Naver Financial joined forces with Woori Bank to offer a loan service to small businesses that sell products online.

Online sellers have struggled to take out loans from top-tier financial institutions due to lack of collateral. So they mostly turned to high-interest rate loan programs offered at financial institutions other than banks, Naver said.

The two companies plan to offer unsecured loans specialized for small business operators selling goods at Naver's online commerce platform, if they prove to have enough credibility.

Financial and non-financial data will both be utilized to identify creditworthy applicants.

While Woori Bank will take charge of crafting loan products and screening applicants, Naver Financial will share its expertise in credit scoring using non-financial data and marketing of loan products.

The new loan product for small online sellers will be launched in the first half of this year, a Naver Financial spokesperson said.

Before partnering with Woori Bank, Naver Financial had teamed up with Mirae Asset Capital to offer loans to under-qualified online sellers last December. Then, Naver was in charge of screening applicants.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]