Ministry of SMEs and Startups to Provide 26.5 Trillion KRW in New Policy Financing in 2025

Support for Small Business Owners and SMEs Facing Management Difficulties Strengthened, Including 8.3 Trillion KRW in Policy Funds

Policy funds totaling 26.5 trillion KRW will be supplied to strengthen support for small business owners and small and medium-sized enterprises (SMEs) facing management difficulties.

On the 26th, the Ministry of SMEs and Startups announced the 2025 policy finance supply plan for small business owners and SMEs. The plan includes 8.3 trillion KRW in policy funds?3.77 trillion KRW for small business owners and 4.53 trillion KRW for SMEs?along with 18.2 trillion KRW in guarantees, comprising 12.2 trillion KRW in new guarantees from regional credit guarantee foundations and 6 trillion KRW from the Korea Technology Finance Corporation, totaling 26.5 trillion KRW in policy finance.

First, to respond swiftly to the various management difficulties faced by small business owners, the conditions for policy fund support will be restructured, and incentives for faithful repayment will be strengthened to promote normalization and recovery of vulnerable small business owners, thereby reinforcing the financial safety net.

Specifically, the scope of emergency management stabilization funds within small business owner policy funds will be expanded to include small business owners experiencing management difficulties due to client business closures or price increases. Considering that micro start-ups find it difficult to use private financial institutions, support will be provided through direct loans, representing a comprehensive reform.

The 'Somang Charging Project' will also be promoted to supply additional liquidity or apply preferential interest rates to small business owners who faithfully repay, helping them maintain hope and overcome difficulties. Additional funds will be provided to those who receive and faithfully repay the newly established 2024 financial support trio (repayment extension system, convertible guarantees, refinancing loans), and preferential interest rates on small business owner policy funds for faithful repayers will be enhanced.

Through policy fund support for growth-potential companies, small business owners will be supported to grow into SMEs, and SMEs into mid-sized enterprises.

The Small Enterprise and Market Service will provide loans to small business owner graduates with high potential to enter the SME sector. Once these companies grow into SMEs, interest rates on their loans from the Small Enterprise and Market Service will be reduced, and additional loans will be provided by the Korea SMEs and Startups Agency through the 'Relay Fund,' encouraging small business owners to grow into SMEs.

Policy fund support will also be diversified to promote innovative growth of merchants and SMEs.

Starting in March, policy funds for SMEs will be provided for domestic SMEs planning to establish and operate overseas subsidiaries. Additionally, a new method will be introduced to support production funds for SMEs supplying products to large corporations in sectors such as cosmetics.

Furthermore, a win-win growth support fund will be newly launched within small business owner policy funds to encourage mutual growth between online platforms and tenant small business owners and to support the sustainable growth of small business owners through these platforms.

The policy finance support system will be advanced to enable companies to achieve innovative growth. Specifically, this includes support through regional credit guarantee foundations and technology guarantees.

Support from regional credit guarantee foundations is a program that guarantees loans to small enterprises and small business owners lacking collateral to facilitate smooth borrowing from banks. In 2025, 12.2 trillion KRW in new guarantees will be supplied.

Technology guarantees support funds needed for the start-up and growth of small and medium venture companies with excellent technology but insufficient collateral. In 2025, a total of 6 trillion KRW in new guarantees will be supplied.

Applications for 2025 small business owner policy funds will open on January 2 for agency loans and January 6 for direct loans via the small business owner policy fund website. However, refinancing loans and win-win growth support funds, which require a call for applications from handling banks and platform companies, will be announced separately.

Applications for SME policy funds can be submitted from January 2 via the Korea SMEs and Startups Agency website. Companies located in Seoul and other regions can apply on January 2?3, while companies in Gyeonggi and Incheon can apply on January 6?7 (Monday and Tuesday).