[2020 National Audit] "Received Scholarship for SME Employment Conditions"…Only 3.8% Recovery Rate for Fraudulent Claims

If You Receive This Scholarship
You Must Work at a Small or Medium Enterprise for Over 6 Months

814 Scholars Who Did Not Fulfill Mandatory Employment
Total Amount Reaches 5.57 Billion Won

Photo by Korea Student Aid Foundation

[Asia Economy Reporter Hyunju Lee] It has been revealed that although most students who received scholarships granted to university students on the condition of working for a certain period at small and medium-sized enterprises (SMEs) did not fulfill their mandatory employment at SMEs during the grace period, the scholarships were mostly not reclaimed.

On the 13th, Bae Jun-young, a member of the National Assembly's Education Committee from the People Power Party, analyzed data on the 'Status of Violations of Employment Obligations by SME-Linked Scholarship Students' received from the Korea Student Aid Foundation. The analysis showed that out of 5.57 billion KRW in scholarships fraudulently received over the past seven years, 5.36 billion KRW was not reclaimed. The recovery rate was only 3.8%.

The Korea Student Aid Foundation has been providing SME-linked scholarships of 2 million KRW per semester since 2013 through the 'Hope Ladder Scholarship Project' to university students who wish to work at small and medium-sized enterprises or start-ups. Students who receive this scholarship are required to work for at least six months at an SME within a 30-month grace period after graduation.

However, 814 scholarship recipients violated the mandatory employment requirement during the grace period, resulting in fraudulent receipt of scholarships amounting to 5.57 billion KRW, but only 210 million KRW was reclaimed.

Provided by Bae Jun-young, Office of the People Power Party

The Korea Student Aid Foundation stated that they have not taken active measures because the statute of limitations for forced recovery, which is 10 years, has not yet passed.

Assemblyman Bae pointed out, "So many students failed to fulfill the six-month mandatory employment at SMEs to the extent that the purpose of the employment-linked scholarship is undermined," and added, "The scholarship foundation needs to improve the selection criteria for scholarship recipients in a more meticulous and systematic way."