"Fintech Financial Testbed Fails to Meet Demand... Cost Support Needs Expansion"

National Assembly Budget Office '2020 Fiscal Year Settlement'
"Should Expand More Toward What Companies Need"

[Asia Economy Reporter Kiho Sung] There have been calls for the government to further expand the 'Financial Testbed Operation and Participation Support' project aimed at supporting innovation in fintech companies. It has been pointed out that the support should be extended beyond the current levels of device, program, and labor cost assistance to include essential areas for fintech companies such as marketing, accounting, and tax expenses.

The National Assembly Budget Office emphasized this in its '2020 Fiscal Year Settlement Committee Analysis' report. According to the report, the government's fintech support projects are divided into nine major categories, with 14.51 billion KRW executed out of the 17.948 billion KRW budget last year, and 3.447 billion KRW remaining unspent.

Among these, the Financial Testbed is a government-supported project that allows fintech companies to stably test innovative financial services. It supports up to 75% of testing costs within a limit of 100 million KRW, and participating companies can negotiate with insurance companies to subscribe to liability insurance tailored to the characteristics of their individual services, receiving up to 50% of the insurance premium through an appropriateness evaluation (up to 10 million KRW per company).

The National Assembly Budget Office explained that out of the 8.617 billion KRW budget allocated to the Financial Testbed, 5.649 billion KRW was executed, and 2.968 billion KRW remained unspent. It further pointed out that although support was expected to be provided to a total of 80 companies, only 45 companies had completed receiving support.

It added, "The cost support items for the 2020 Financial Testbed cost support project are limited to hardware and software purchase costs and labor costs, which seem insufficient to meet the demands of companies," and emphasized, "It is necessary to consider expanding the cost support to include various items such as marketing expenses, data purchase costs, and accounting and tax-related expenses to provide broader support to capable companies."

The purpose of supporting Financial Testbed costs is not simply to assist many companies but to help create innovative services through cost support. Therefore, even if supporting a single company, it is necessary to provide broad support to capable companies, which raises the need to review whether the 'support level' is appropriate.

The National Assembly Budget Office analyzed, "Authorities should consider the purpose of the project, the demands of companies participating in the Financial Testbed, and the support contents of similar projects in other ministries," and added, "Through this, it is necessary to enhance the effectiveness of the project by reforming the system to include items that Financial Testbed companies practically need, such as data purchase costs and patent and technology fees, in the cost support contents."

This content was produced with the assistance of AI translation services.