Korea EXIM Bank to launch $150 mn fund supporting SME, middle-market companies

[Courtesy of EXIM bank]

The Export-Import Bank of Korea (EXIM bank) will establish a fund with a target of at least 20 billion won (around $150 million) to support the overseas expansion of small and medium-sized enterprises (SMEs) and middle-market companies, it announced on Wednesday.

The bank will contribute a total of 50 billion won to establish the fund, with the remaining amount to be raised from the private sector by selected fund managers.

Amid unfavorable economic conditions both at home and abroad, including rising raw material prices and the Russia-Ukraine conflict, EXIM Bank is looking to provide more support to small and mid-sized enterprises specifically. For funds investing in companies located outside of the Seoul metropolitan area, the policy bank is considering benefits such as giving a portion of the returns attributable to the bank to fund managers as an incentive, in proportion to the investment amount. EXIM Bank plans to provide a total of 31 trillion won in financial support to strengthen its assistance to small and mid-sized enterprises in 2023 alone.

“We have decided to launch this fund to help our small and mid-sized enterprises overcome domestic and international challenges and to promote balanced regional development,” a bank official said.

Once the fund managers are selected, they will go through an approval process with the Minister of the Economy and Finance to create the fund sometime in 2024. More details about the project are available on the EXIM Bank website.