Posco said Thursday it had signed a memorandum of understanding with KB Kookmin Bank to launch a supply chain finance service aimed at improving liquidity for its steel industry suppliers.

The agreement, signed at Posco Center in southern Seoul, was attended by Posco President Lee Hee-geun and KB Kookmin Bank CEO Lee Hwan-ju.

The new financing program will connect companies across Posco's supply chain with the bank, helping suppliers secure funding more easily when faced with delayed payments or limited collateral.

Under the partnership, KB Kookmin Bank will manage payment settlements, provide loans to Posco's partner companies and offer services including environmental, social and governance consulting.

The two companies plan to integrate the bank's lending program into Posco's My Posco platform and launch the service later this year. Once available, suppliers will be able to complete the entire loan process — from application to disbursement — through the platform.

Posco said participating companies would receive preferential interest rates among the lowest in the industry, enabling them to secure liquidity while lowering financing costs amid the prolonged downturn in the steel sector.

"This agreement takes Posco's coexistence cooperation model one step further," Lee said. "We hope it becomes a model for collaboration between Korea's manufacturing and financial industries."

Posco and KB Kookmin Bank also plan to hold a joint briefing for partner companies later this year to explain the program's financial benefits and support measures.