National Participation Growth Fund Sales Begin on May 22... Up to 200 Million Won Per Person, 5-Year Redemption Restriction

FSC Releases Investor FAQ... 600 Billion Won First-Come, First-Served Sales
High-Risk Product with No Principal Guarantee

The "National Participation Growth Fund," a public-participation type fund that invests in advanced strategic industries and shares the returns, will be offered on a first-come, first-served basis starting May 22, with a total size of 600 billion won. This is a high-risk investment product with no principal guarantee. Investors must make a lump-sum payment, and redemption is not possible for five years after subscription.

At the 'National Growth Fund Strategy Committee Meeting' held last December at the Korea Development Bank in Yeouido, Seoul, key attendees including Eogwon Lee, Chairman of the Financial Services Commission (third from the left), Seongjin Seo, Chairman of Celltrion, and Hyunju Park, Chairman of Mirae Asset, are performing a commemorative ceremony for the launch. 2025.12.11 Photo by Dongju Yoon

On May 19, the Financial Services Commission released a FAQ document for investors in the National Participation Growth Fund, outlining key subscription conditions and important notes.

The fund will be available for three weeks from May 22 to June 11, but sales may close early if the entire 600 billion won allocation is sold out before then.

Of the total amount available, 20%, or 120 billion won, is reserved for low-income individuals. Eligible participants are those with annual earned income of 50 million won or less, or those with total comprehensive income (including non-wage income) of 38 million won or less. The low-income allocation will be available from the start of sales until June 4. Any portion not sold during the first two weeks will be made available to general investors in the third week.

Subscriptions can be made at ten major banks and fifteen securities firms. The banks are KB Kookmin Bank, IBK Industrial Bank of Korea, NH Nonghyup Bank, Shinhan Bank, IM Bank, Woori Bank, Hana Bank, Kyongnam Bank, Kwangju Bank, and Busan Bank. The securities firms are KB Securities, NH Investment & Securities, Daishin Securities, Meritz Securities, Mirae Asset Securities, Samsung Securities, Shinyoung Securities, Shinhan Investment & Securities, IM Securities, Woori Investment & Securities, Yuanta Securities, Hana Securities, Korea Investment & Securities, Hanwha Investment & Securities, and Kiwoom Securities (online only). Subscriptions can be made both in person at branches and online.

The annual subscription limit per person is 100 million won, with a maximum total investment of 200 million won over five years. The limit for general accounts is 30 million won. The minimum subscription amount ranges from 100,000 to 1 million won, depending on the distributor.

Tax benefits are also offered. Investors can receive income tax deductions of up to 18 million won and benefit from separate taxation of dividend income at a 9% rate.

To receive these tax benefits, investors must submit an income verification certificate required for opening an Individual Savings Account (ISA). This certificate can be issued through the National Tax Service Hometax website, Government24 website, or at tax offices. The Financial Services Commission explained that preparing these documents before the product launch will help speed up the subscription process. However, those subscribing through general accounts do not need to submit this document. In addition, residents aged 15 to under 19 must provide a certificate of income for the previous year.

The National Participation Growth Fund is a lump-sum investment product, not an installment savings product. Investors must make a one-time payment at the time of subscription, and early redemption is restricted for five years.

In particular, this product is classified as a top-tier, high-risk investment with no principal guarantee. Investors can only subscribe if they are deemed suitable after an investor profile assessment.

If an investment loss occurs, government funds will absorb losses first; however, the actual loss coverage effect may be less than 20%. The fund is structured with 600 billion won from public investors (senior tranche), 120 billion won from government funds (subordinated tranche), and seed investments from ten sub-fund management companies (also subordinated). All capital is then allocated across ten sub-funds. If losses occur, the subordinated resources—government funds and management company investments—absorb losses before the public's investment.

A Financial Services Commission official stated, "Government funds are provided as subordinated capital to cover up to 20% of losses on public investments first. However, when calculated based on the total size of each sub-fund, the actual percentage of government loss absorption may be less than 20%."

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