Tech Financing
The government will boost the size of technology financing, that is, loans provided in security for technology. Specifically, the Technology Credit Loan Funds of the Industrial Bank of Korea and the Korea Development Bank will be increased 10-fold to 1 trillion won (US$985 million) while the 300 billion won (US$295 million) Technology Evaluation Investment Fund will be raised in the Growth Ladder Fund. Also, excessive regulations on the banking sector will be removed in order to reform the inflexible part of its business culture.
The Financial Services Commission reported the banking sector reform plan for this purpose on August 26 at the National Economic Advisory Council meeting, which was presided over by President Park Geun-hye. “The plan will help companies with advanced technologies procure the financial resources they need with greater ease,” the commission explained. President Park Geun-hye said in response, “I believe that financial innovation is one of the most important preconditions for the creative economy, but start-ups and venture firms are still thirsty for technology financing in spite of over liquidity as of late.”
She continued, “The banking sector is not willing to take risk with no reliable yardstick present for technology evaluations, but this practice impeding technology financing must be broken right away by ameliorating supervisory and employee compensation systems.”