SMEs Ministry Sets 16.8 Trillion Won Budget for Next Year... Major Increase in Venture and AI Investment

Comprehensive Support from Startups and Ventures to Small Business Owners
Focused Investment in Digital Transformation and Export Expansion
Emphasis on Restructuring and Reinvestment for "Real Growth"

The Ministry of SMEs and Startups will significantly increase next year's budget to focus on supporting startups and ventures, digital transformation, and small business owners. The aim is to support the "real growth" of small and medium-sized enterprises (SMEs) and small business owners.

On September 2, the Ministry announced that it had set the 2026 budget at 16.8449 trillion won. This represents an increase of 1.5961 trillion won (10.5%) compared to this year's main budget of 15.2488 trillion won.

A key feature of this budget is the restructuring of sub-projects to make them easier for the public to understand. The Ministry reduced expenditures by a total of 1.9 trillion won, including 1.4 trillion won in loan programs, habitual operating expenses, and certain research and development (R&D) projects that have reached their sunset dates, and instead concentrated investments in new growth drivers. The five main investment areas are: ▲Startup and venture innovation ▲Digital and AI transformation ▲Crisis response for small business owners ▲Revitalization of local business ecosystems ▲Establishment of a foundation for mutual growth.

The area with the largest budget increase is support for startups and ventures. The budget for this sector has been set at 4.3886 trillion won, up 23.3% from this year's 3.5585 trillion won. The Korea Fund of Funds will be expanded to a record 1.1 trillion won, with half allocated to artificial intelligence (AI) and deep tech investments (Next Unicorn Project). The "Re-challenge Fund" and secondary and M&A investments will each be increased to over 100 billion won to support the comeback of failed entrepreneurs and to revitalize the exit market. The "Unicorn Bridge" program (32 billion won), which aims to nurture innovative startups into global unicorns, and the "Super Gap Startup 1000+ Project" targeting new industries such as AI and biotechnology, will also be expanded.

The budget for digital and AI transformation has been increased by 16.3% year-on-year to 3.7464 trillion won. The Ministry's R&D budget alone has grown by 45% to a record 2.1955 trillion won. The budget for supplying smart factories to small and medium-sized enterprises has nearly doubled to 436.6 billion won. A new project will also be launched to rapidly commercialize AI application products in manufacturing sites. In terms of export support, the export voucher program (150.2 billion won) and export consortiums (17.8 billion won) will be expanded, and a K-Beauty Cluster (3 billion won), centered on cosmetics, will be established to diversify exports in connection with K-Culture.

The budget for supporting small business owners has been set at 5.5278 trillion won, a 2.5% increase from this year. Policy funds totaling 3.362 trillion won will be provided, including the Small Business Management Stability Voucher (579 billion won), which offers up to 250,000 won to 2.3 million small business owners with annual sales of less than 104 million won. New initiatives include support for global expansion of K-Small Businesses (128.1 billion won) and the use of AI by innovative small business owners (11.4 billion won). To revitalize traditional markets, the issuance of Onnuri gift certificates will be increased to 5.5 trillion won, with a greater share allocated to digital gift certificates.

The budget for revitalizing local economies has been set at 1.3175 trillion won. Programs such as the SME Innovation Voucher (65.2 billion won), Global Innovation Zones (17.7 billion won), and the Jump-Up Program (66.8 billion won) will be expanded, and R&D support for local key industries will be increased more than threefold to 96.9 billion won. A new "Regional Startup Festival" will also be launched to create a local startup boom.

In the area of mutual growth, the Ministry will increase the budget for fair transactions between large corporations and SMEs, and expand support for SME technology protection to 5.1 billion won. In particular, to address succession gaps in SMEs, the Ministry will, for the first time, allocate 850 million won to the "Business Succession M&A Support" program, providing systematic support from demand discovery to matching.

Minister Han Seong-sook of the Ministry of SMEs and Startups stated, "We have thoroughly reviewed support programs from the ground up and carried out bold restructuring of expenditures, carefully designing the budget to ensure that SMEs and small business owners can achieve real growth." She added, "As this is the first budget proposal formulated under the current administration, we will execute it swiftly and meticulously so that the warmth of fiscal policy quickly permeates our economy and truly benefits SMEs and small business owners."

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