The government plans to enhance its evaluation system for policy loans to startup businesses, aiming to pinpoint areas that can maximize the impact of these critical funds. (Image courtesy of Pixabay/CCL)
SEOUL, Sept. 25 (Korea Bizwire) – The government will work to further advance its evaluation system for policy loans to startup businesses, a move aimed at identifying areas that can make the most out of the much-needed funds, the vice chief of the financial regulator said Wednesday.
Kim So-young, deputy head of the Financial Services Commission (FSC), made the remark in a policy financing coordination meeting, attended by officials from government ministries, policy lenders and loan guarantee providers.
He noted a recent study of investment funds provided to local businesses showed the firms that had received government support posted a higher rate of growth than those that had not received such support.
However, the average operating income and interest compensation ratio of the recipient companies were found to be lower than those of other businesses, Kim said.
“This study is significant in that it was the first attempt to quantitatively analyze whether an input of policy funds has led to an improved output of business performance, and I hope it will be further developed to a point where it will enable the provision of enough policy funds to businesses that need such support in a timely manner through adequate means and in industrial sectors it can be most effectively used,” he added.
Nearly 10 trillion won (US$7.5 billion) has been provided to 1,073 firms since 2018 in government investments under a scale-up program, according to the FSC.
Wednesday’s meeting marked the eighth of its kind to discuss where the 240.5 trillion won in policy lending and loan guarantees should be used this year.
The FSC said the amount grew from 212 trillion won as the Korea Technology Finance Corp., with 28.5 trillion won, freshly joined the group, previously consisting of two policy lenders — Korea Development Bank and Industrial Bank of Korea — and the state-run Korea Credit Guarantee Fund.
(Yonhap)
