South Korea's financial authorities are set to mobilise all available policy finance institutions to ensure that regional businesses and households can access funding at lower interest rates and higher loan limits, according to South Korea's ChosunBiz.
ChosunBiz reported that the Financial Services Commission has outlined plans to supply KRW164tn ($126bn) in annual policy funds to the provinces by 2028. The figure represents an increase of KRW34tn from KRW130tn last year, as part of efforts to strengthen regional financial support.
On June 11, the FSC held a “policy finance on-site partnership” event at the Daejeon Intercity Hotel together with six policy finance institutions to outline the plan. These include the Korea Development Bank (KDB), Industrial Bank of Korea (IBK), Korea Credit Guarantee Fund (KODIT), Export-Import Bank of Korea (KEXIM), Korea Trade Insurance Corporation (K-SURE), and Korea Technology Finance Corporation (KOTEC), which will conduct site visits to regional industrial hubs to provide tailored financial support through a field-based cooperation platform.
The FSC also outlined five key policy tasks, including expanding participation of export and trade finance institutions, increasing co-prosperity finance, strengthening support for the regional energy transition and K-GX initiatives, enhancing standing support systems for preferential regional financing, and encouraging greater private-sector participation in regional lending.
With the inclusion of KEXIM and K-SURE alongside KDB, IBK, KODIT, and KOTEC, the target share of policy finance directed to the provinces is expected to rise to 45 percent by 2028, the report added.