[Asia Economy Reporter Donghyun Choi] The Ministry of SMEs and Startups announced that the amendment to the Technology Guarantee Fund Act passed the Cabinet meeting on December 27 last year and was promulgated on the 3rd.
The main point of this amendment is to elevate the legal basis for the statutory contributions paid by financial companies to the Technology Guarantee Fund (Kibo) from provisions in presidential decrees to provisions in the law. Previously, the delegation system was 'law → presidential decree → ministerial ordinance,' but going forward, it has been simplified to 'law → ministerial ordinance.'
Banks and other financial companies regularly contribute a certain percentage of their corporate loan balances, as stipulated by law, to guarantee institutions including Kibo. Kibo uses these contributions as resources to establish basic assets and issues guarantees to small and venture enterprises that have excellent technological capabilities but low credit ratings or insufficient collateral, enabling them to obtain loans from banks and other financial companies. Previously, the upper limit on the contribution rate by banks to Kibo was set at '0.3% per annum' in presidential decrees rather than in the law. However, this upper limit on the contribution rate is now stipulated by law through this amendment.
Furthermore, with this amendment, the mandatory contribution obligations, which restrict property rights of financial companies, are now regulated by law instead of presidential decrees, thereby aligning with the principles of rule of law administration.
Minister Lee Young of the Ministry of SMEs and Startups stated, "By stipulating the statutory contribution ceiling for banks in the law, we will protect the property rights of banks and strive to ensure that sufficient growth funds are supplied to small and venture enterprises leading the digital economy era using these resources."
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