South Korea Prepares to Funnel KRW 75T as Financial Assistance

South Korea has prepared a 75.9 trillion won ($56.97 billion) financial assistance programme for companies increasing investment in key sectors as well as small businesses dealing with the effects of high interest rates.

The programme includes 15 trillion won in low-interest policy loans from a state-run bank for key industries such as semiconductors and batteries, as well as 20 trillion won from commercial banks to support small and medium-sized businesses, according to a Financial Services Commission statement issued on Thursday.

"Our banks need to start making efforts to expand support for companies, beyond consumer financing focused on mortgage loans," said Kim Joo-hyun, the chairman of the bank.

Evolving trade relations with China, technological advancement in major industries, and global supply chain fragmentation present new challenges to businesses, highlighting the need for regulatory reform and financial support, according to Kim.

Banks will offer a temporary interest rate cut to companies experiencing liquidity issues this year as a result of high interest rates, according to the commission.