Expanded Support for AI, AX, and K-Beauty Loans
Comprehensive Overhaul Toward a User-Centered Structure
The Ministry of SMEs and Startups will inject over 4.4 trillion won in policy funds next year to support small and medium-sized enterprises (SMEs) at each stage of their growth. The ministry will also launch a user-centered system reform.
On December 22, the Ministry of SMEs and Startups announced the "2026 SME Policy Fund Operation Plan." The total policy fund of 4.4313 trillion won will be divided into 4.0643 trillion won in loans and 367 billion won in interest subsidies for loans from private financial institutions.
Next year’s policy funds will focus on strengthening the productive financial functions of SMEs and improving the support system to be more user-oriented. The ministry will provide 1.6 trillion won in innovative startup commercialization funds for companies less than seven years old, and 1.7 trillion won in new market entry support funds and new growth base funds for companies in the growth stage. It will also supply 250 billion won in emergency management stabilization funds for companies facing management difficulties.
To promote balanced regional development and innovation among non-metropolitan companies, more than 60% of the total policy funds will be concentrated in non-metropolitan areas. Policy funds will be prioritized for promising SMEs operating in innovative growth sectors such as artificial intelligence (AI) and semiconductors. The ministry will also introduce the "AX Sprint Preferential Track" to support companies pursuing AI transformation (AX).
The supply scale and annual support limit for the K-Beauty Loan will be significantly increased. The ministry will continue to maintain a track that allows applications for the K-Beauty Loan with only proof of order documents, thereby strengthening support for the K-beauty sector, a major export item for SMEs.
Support for companies affected by protectionist measures will also continue. Since the emergency trade risk response fund, which was temporarily operated this year to support companies in U.S. tariff-affected sectors, will expire, its support targets will be incorporated into the emergency management stabilization fund and continue next year. The ministry will also expand funding for overseas subsidiaries and strengthen support for companies seeking to pioneer new markets in response to changes in the global trade environment.
The policy fund support system will be improved for user convenience. A new "Policy Fund Navigation" system will be introduced to recommend customized funding options based on basic information entered by applicants. The ministry expects this system to serve as a guide to help companies identify the most suitable funds. In addition, for mature companies experiencing declining profitability, in-depth diagnostic consulting will be provided prior to policy fund support to suggest management improvement directions, thereby strengthening customized non-financial support.
The ministry plans to reorganize the current complex policy fund structure-which consists of six main projects and 14 sub-projects-into a more user-friendly format by the first half of next year.
The ministry will also strengthen the soundness of policy funds by enhancing monitoring of insolvent companies and preventing misuse. An early warning system will be used to continuously monitor signs of insolvency among supported companies, enabling preemptive checks and, if necessary, support for normalization such as repayment deferral and maturity extension. The ministry will also introduce a new "one-strike-out" rule, restricting future loan applications if facilities purchased with policy funds are found to be intentionally used for unauthorized purposes, such as subleasing.
As part of efforts to prevent third-party misconduct in policy fund support, the ministry will work with experts and relevant organizations to develop legislative measures by the first half of next year, focusing on the formalization of consulting and sanctions against illegal activities. The ministry will also improve the system to allow certain promising companies to receive policy fund support up to five times, compared to the current limit of three times over five years.
Applications for SME policy funds can be submitted via the Korea SMEs and Startups Agency website starting January 5 next year. Detailed information is available on the Ministry of SMEs and Startups website, the dedicated policy fund call center (1811-3655), and through policy fund loan plan announcements.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
