8 Trillion KRW Policy Fund Support for SMEs and Small Business Owners Next Year

Ministry of SMEs and Startups Announces Policy Fund Support Plan... Supply Tailored to Growth Stages

Choi Won-young, Director of Global Growth Policy at the Ministry of SMEs and Startups, is announcing the 2023 operational plan for policy funds for small and medium enterprises and small business owners on the 29th at the briefing room of the Ministry of SMEs and Startups in Sejong.

A total of 8 trillion KRW in policy funds will be provided to small and medium-sized enterprises (SMEs) and small business owners next year. The Ministry of SMEs and Startups (Minister Lee Young) announced the '2023 SME and Small Business Policy Fund Support Plan' on the 29th.

The SME policy fund is a program that provides long-term loans at lower interest rates compared to the market to promising SMEs with low credit ratings but excellent technological business potential. The policy funds will be supplied according to the growth stages of SMEs: 2.23 trillion KRW for the startup phase, 2.082 trillion KRW for the growth phase, and 661.9 billion KRW for the re-leap phase. SMEs in need of funds can apply for up to 500 million KRW in working capital and up to 6 billion KRW in facility funds.

The small business policy fund is a loan program designed to promote management stability and self-reliance of small business owners. It plans to provide 500 billion KRW to resolve management difficulties of general small business owners, 1.3 trillion KRW to stabilize management for vulnerable groups such as disaster-affected and low-credit small business owners, and 1.2 trillion KRW to foster entrepreneurial small business owners. For funds supporting entrepreneurial small business owners, up to 500 million KRW can be provided, while the remaining funds are available up to a limit of 100 million KRW.

Among the major changes, a new interest subsidy of up to 3% will be introduced for companies that find it relatively easy to use commercial banks when they take out loans from these banks. This interest subsidy was introduced to discover promising SMEs with significant policy support effects by utilizing the infrastructure of commercial banks. The total loan amount subject to the interest subsidy program is 800 billion KRW. Since this program will be implemented for the first time next year, the system will be established in the first quarter, and detailed information will be provided through a separate announcement at the end of March after consultations with the banking sector.

The policy fund application process will also be revamped to enhance convenience for policy customers. Currently, the SME policy fund application process proceeds on a first-come, first-served basis starting from online consultation reservations, which sometimes prevents companies with excellent technological business potential and urgent funding needs from even getting a chance to apply for consultation. To prevent this and provide a fair application opportunity, all companies wishing to apply for policy fund consultations will be given a chance each month, but the consultation candidates will be selected through a policy priority evaluation. The third week of each month will be operated as the application period for the next month's policy fund consultations, and all companies applying within the deadline will be accepted. Among them, companies that pass the policy priority evaluation will be given the opportunity for policy fund consultation and application. However, funds for companies facing management difficulties, such as re-leap support funds and emergency management stabilization funds, will be fully consulted without the policy priority evaluation.

Among the policy funds announced this time, applications for SME policy funds will start on January 3 next year through the Korea SMEs and Startups Agency. Applications for small business policy funds will be processed through the Small Enterprise and Market Service starting January 2.

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