South Korea's $400 Million Bailout for E-Commerce Crisis

South Korea will provide $400 million to aid small businesses affected by delays in payments from the Qoo10 e-commerce platforms. The financial assistance comes amid failed payments to merchants, prompting an investigation. Qoo10's CEO has pledged his own assets to help resolve the situation while the government implements low-interest loans and extensions on existing loan repayments.

South Korea is set to provide $400 million in financial support to small businesses impacted by payment delays on two Qoo10 e-commerce platforms. This move follows the Singapore-based firm's founder's pledge to utilize his own assets for customer and vendor compensation.

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

The South Korean government plans to offer low-interest loans to affected businesses and extend deadlines for loan and tax repayments. Vice Finance Minister Kim Beom-seok confirmed the government's commitment to minimizing damages. Similarly, South Korea's prosecutor general has ordered a dedicated team to investigate.

(With inputs from agencies.)