Korea Technology Finance Corporation (KOTEC) said on the 22nd that it signed a "financial support business agreement to foster social ventures and promote the growth of the social and solidarity economy" with Woori Bank.
The agreement was signed to support stable growth of social venture corporations and to ease financing difficulties. Under the agreement, KOTEC will provide a total of 18.5 billion won in agreement guarantees based on Woori Bank's special grants and guarantee fee support.
KOTEC will use 300 million won in special contributions as funding to supply 6 billion won in special grant agreement guarantees, raising the guarantee ratio from 85% to 100% for five years and offering preferential benefits of a 0.5 percentage point (P) reduction in guarantee fees.
In addition, KOTEC will supply 12.5 billion won in guarantee fee support agreement guarantees based on Woori Bank's 200 million won in guarantee fee support funds, and Woori Bank will support 0.8 percentage points of the guarantee fee for two years.
The support targets corporations that KOTEC has determined to be social venture corporations. KOTEC plans to continue practical financial support for these corporations, including by linking social venture impact guarantees.
KOTEC Chair Kim Jong-ho said, "This agreement is meaningful in that it has established a cooperative framework for financial support for social venture corporations," adding, "KOTEC will continue to support the growth of social ventures as a policy finance institution and do its best to spread ESG management."
Meanwhile, KOTEC opened the Social Venture Value Evaluation Center in 2018 to exclusively handle identification of social venture corporations, and is building a foundation for the sustained growth of social venture corporations through dedicated guarantee products such as impact guarantees and various support programs.