Risk Communication in Disaster Management: COVID-19 Financial Governance for Small and Medium-Sized Enterprises (SMEs) in South Korea

This study illuminates Korean financial governance’s unprecedented impacts on large swaths of the economy during COVID-19. As an analysis technique, we adopt risk communication to investigate how and to what extent the Korean government expanded its involvement in social and financial management. The study confirms that Korea controlled COVID-19 transmission by prioritizing communication, drawing on lessons acquired from previous experiences fighting the Severe Acute Respiratory Syndrome (SARS) in 2003 and the Middle East Respiratory Syndrome (MERS) in 2015. This finding is consistent with the survey results on small and medium-sized enterprises (SMEs) and banks in Seoul and Ulsan, Korea, which were conducted from January to February 2021. The data analysis presents that SMEs staved off bankruptcy because financial institutions were putting off collecting bonds to help SMEs manage their cash flow. We interpret these results as the government stepping in to reflect SMEs’ needs for debt reduction, loan maturity extensions, and interest repayment suspension options on its COVID-19 responses policies.