Korea Credit Guarantee Fund and IBK to Provide 200 Billion Won in Preferential Guarantees for Youth Startups

Targeting Promising Startups with CEOs Aged 39 or YoungerGuarantee Ratio up to 100%

The Korea Credit Guarantee Fund and Industrial Bank of Korea will provide a total of 200 billion won in preferential guarantees to support promising youth startups in raising capital.

On August 21, the Korea Credit Guarantee Fund announced that it had signed a Financial Business Agreement for Vitalizing Promising Youth Startups with Industrial Bank of Korea. This agreement was established to invigorate the youth startup ecosystem, in line with the government’s policy to strengthen youth-related initiatives. Through the agreement, the two institutions will introduce dedicated preferential financial products tailored for promising youth startups.

Eligible applicants are promising youth startups whose CEOs are 39 years old or younger. The Korea Credit Guarantee Fund will supply a total of 200 billion won in guaranteed financing for such companies and will raise the guarantee ratio up to 100% for a period of five years. The guarantee fee rate will also be reduced by up to 0.7 percentage points.

For companies whose total guaranteed amount, including any existing guaranteed balances, is 300 million won or less, a fixed annual guarantee fee rate of 0.3% will be applied regardless of credit rating. Industrial Bank of Korea will also lower the initial financing costs for companies using the agreement guarantee by offering up to 1.5 percentage points off loan interest rates. A Korea Credit Guarantee Fund official stated, “We hope this agreement will enable promising youth startups to run their businesses more stably,” and added, “We will continue to provide policy support so that young entrepreneurs can become the driving force of innovation-led growth without fearing failure.”

© The Asia Business Daily. All rights reserved. Unauthorized AI training and use prohibited.