Jungjingong Supports 90 Billion KRW in Growth-Sharing Loans

Support Up to 3 Billion KRW Per Company

[Asia Economy Reporter Kim Cheol-hyun] The Small and Medium Business Corporation (Chairman Kim Hak-do, hereinafter referred to as SBC) announced on the 20th that it will disburse 90 billion KRW in growth-sharing loans this year for small and medium venture companies with excellent technological performance and future growth potential.

Growth-sharing loans are policy funds provided through a hybrid investment and financing method by directly acquiring convertible bonds (CB) and redeemable convertible preferred stocks (RCPS) of companies with high initial public offering (IPO) potential. The issuance conditions for convertible bonds are as follows: for companies established for more than 7 years, the loan period is within 5 years (including a 2-year grace period), and for companies established for less than 7 years, it is 7 years (including a 4-year grace period). The nominal interest rate is 0.5%, the maturity guaranteed interest rate is 3%, and the support limit is up to 3 billion KRW. In particular, for startup companies less than 3 years old, the nominal interest rate is lowered to 0.25%, and the corporate valuation is omitted at the time of convertible bond acquisition. Instead, a future value-linked system is operated to enable rapid support by linking to subsequent evaluation values by institutional investors.

Small and Medium Business Corporation

This year, SBC plans to actively support companies in ultra-gap and new industry sectors, as well as ESG (environment, social, governance) startup companies, to ensure that the growth momentum of companies is not damaged even in an era of low growth accompanied by economic recession. In addition, growth-sharing loans will timely supply liquidity to regions neglected in the private investment market, such as companies located in provincial areas and traditional manufacturing industries, to drive innovative growth.

Kim Se-jung, Head of Growth Convergence Finance Division, said, "We will expand the support system so that small and medium venture companies can continue to grow beyond survival by promoting domestic and international IR events to attract private follow-up investment and global expansion for companies supported by growth-sharing loans."

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