Restaurants available on delivery app Baedal Minjok will have a broader access to loans from a commercial bank, if they show proof that they were winning more online food delivery orders.
This will be part of commitments in a memorandum of understanding by Korea‘s mobile food delivery unicorn Woowa Brothers and commercial lender Hana Bank, Woowa Brothers said on April 3.
Under the MOU, the door-to-door food delivery company and the bank pledged to create a credit rating model that uses the number of delivery orders through Woowa’s Baedal Minjok app and the repeat customer rate in the app as variables.
Woowa Brothers CEO Kim Beom-jun (left) and Hana Bank CEO Ji Sung-kyu pose for a photo at a ceremony for a memorandum of understanding on Thursday at Woowa Brothers headquarters in Seoul. (Woowa Brothers)
Hana Bank will also use the restaurants’ advertisements on the click-to-order platform and the volume of user feedback to gauge the rating.
Woowa Brothers and Hana Bank expected restaurant owners within Baedal Minjok app’s network to improve their credit scores, so that they could access loans that would have otherwise been rejected, and benefit from lower interest rates.
Woowa Brothers did not clarify the timing of the new credit model’s launch.
“We expect that the MOU could mitigate the financial burden of Baedal Minjok member restaurants,” Woowa Brothers said in a statement. “We will continue to lay out various measures to financially support restaurant owners.”
In February, Woowa vowed to pay riders the minimum wage and waive their motorcycle rental fees if they are quarantined for COVID-19.
Woowa Brothers is Korea’s largest food delivery app operator, with a $4 billion valuation. It is awaiting approval for a proposed acquisition by German company Delivery Hero, which already owns two delivery apps in Korea -- Yogiyo and Baedaltong.
By Son Ji-hyoung (firstname.lastname@example.org)