The Ministry of SMEs and Startups and the Financial Services Commission are joining hands with the five major financial groups to shift to "productive finance" to revitalize the venture and startup ecosystem.
The Ministry of SMEs and Startups (MSS) and the Financial Services Commission (FSC) said on the 30th that they signed a "business agreement for venture investment revitalization, the startup-for-all project, and a grand shift to productive finance" at Tips Town in Gangnam, Seoul.
The core aim of the agreement is to connect the capital and capabilities of the five major financial groups with the venture ecosystem to expand startup opportunities and strengthen a private-led investment ecosystem. Minister Han Seong-sook of the Ministry of SMEs and Startups, Financial Services Commission Chair Lee Eog-weon, the chairmen of the five major financial groups—KB, Shinhan, Hana, Woori, and NH NongHyup—as well as heads of related institutions including Korea Venture Investment Corporation and Korea Technology Finance Corporation (KOTEC) attended the signing.
At the heart of the agreement is the creation of private venture fund-of-funds. Starting with 400 billion won this year and totaling 800 billion won by 2029, the five major financial groups plan to create fund-of-funds to expand the supply of private capital to the venture investment market. In particular, Hana Financial Group will commit a total of 400 billion won to lead the expansion of the fund-of-funds. The government will support private participation with incentives such as tax benefits.
The financial groups will also work with the Korea Fund of Funds to participate in creating a 100 billion won LP growth fund and a 20 billion won regional growth fund, strengthening the expansion of regional venture ecosystems and the supply of risk capital. In addition, to help portfolio companies expand globally, they plan to link IR using overseas networks, follow-on investments, and IPO support.
The five major financial groups will participate in the "startup-for-all project" promoted by the Ministry of SMEs and Startups (MSS). The five groups will make a special grant of 20 billion won, and Korea Technology Finance Corporation (KOTEC) will establish 150 billion won in agreement-based guarantees to ease funding burdens for prospective entrepreneurs. Practical support such as guarantee fee reductions and higher guarantee ratios is also included. Financial mentoring, accelerating, and promotion through banking apps will proceed in parallel.
The Ministry of SMEs and Startups (MSS) and the Financial Services Commission (FSC) plan to expand cooperation in areas such as policy fund management, discovering promising companies, and revitalizing regional economies to enhance the competitiveness of the overall startup, venture, and growth ecosystem.
Minister Han Seong-sook said, "This agreement is a starting point for consolidating the expertise and resources of the startup and venture ecosystem and the five major financial groups," adding, "We will create a 40 trillion won annual venture investment market to leap into the ranks of the world's four leading venture nations and usher in a national startup era."
Financial Services Commission Chair Lee Eog-weon said, "The five major financial groups are key players that will lead the grand shift to productive finance," adding, "We expect Korea's startup, venture, and growth ecosystem to become even more vibrant."