S. Korea Submits KRW 16.8T Small Business Budget for 2026

Sejong, South Korea - The Ministry of SMEs and Startups submitted a KRW 16.8 trillion (US$12.0 billion) budget proposal for 2026 to the National Assembly on Tuesday. The proposal represents a KRW 1.6 trillion increase from 2025's KRW 15.2 trillion allocation.

The ministry restructured spending by 1.9 trillion KRW. Loan program budgets were reduced by KRW 1.4 trillion. Routine expenses and expired research programs were cut.

Five areas will receive funding. 

• Startup and venture programs will receive KRW 4.4 trillion (US$3.1 billion). 
• Small business programs will receive KRW 5.5 trillion (US$3.9 billion). 
• Digital transformation programs will receive KRW 3.7 trillion (US$2.6 billion). 
• Regional business development will receive KRW 1.3 trillion (US$929 million). 
• Partnership programs will receive KRW 570 billion (US$407 million).

The Korea Fund of Funds will receive KRW 1.1 trillion (US$786 million). 

The ministry allocated KRW 550 billion (US$393 million) of this amount to artificial intelligence and deep-tech investments through the NEXT UNICORN Project.

Government contributions for failed entrepreneur support will increase from KRW 300 billion (US$214 million) in 2025 to KRW 800 billion (US$571 million) in 2026. The total fund capacity will reach KRW 1.333 trillion (approximately US$952 million).

Research and development funding for small and medium-sized enterprises will total KRW 2.195 trillion (approximately US$1.57 billion). 

• This represents a 45 percent increase from 2025's KRW 1.517 trillion (US$1.08 billion). 
• The TIPS startup technology program will increase from KRW 477.7 billion (US$341 million) to KRW 668.4 billion (US$477 million). 
• The Scale-up TIPS program will increase from KRW 141 billion (US$101 million) to KRW 292.4 billion (US$209 million).

Smart factory programs will receive KRW 436.6 billion (US$312 million). 

• This represents an 84.9 percent increase from 2025's KRW 236.1 billion (US$169 million). 
• A new artificial intelligence application program will receive KRW 99 billion (US$71 million).

Small business policy loans will total KRW 4.1 trillion (US$2.9 billion). 

• Innovation startup funds will receive KRW 1.636 trillion (US$1.17 billion). 
• Growth foundation funds will receive KRW 1.111 trillion (US$794 million). 
• Market entry support funds will receive KRW 316.4 billion (US$226 million).

Management stability vouchers will receive KRW 579 billion (US$414 million). 

• The program will provide up to KRW 250,000 (US$179) to 2.3 million small business owners. 
• Eligible businesses must have annual revenues below KRW 104 million (US$74,286). 
• Vouchers will cover utility bills, insurance premiums, communication costs, and fuel expenses.

Regional development programs will receive KRW 1.318 trillion (US$941 million). 

• This represents a 4.3 percent increase from 2025's KRW 1.263 trillion (US$902 million). 
• Three additional innovation zones will be established. 
• Research support for companies within existing zones will be expanded.

The Onnuri gift certificate program will issue vouchers worth KRW 5.5 trillion (approximately US$3.9 billion). 

Digital certificates will account for KRW 4.5 trillion (US$3.2 billion). 

Paper certificates will account for KRW 1 trillion (US$714 million). The ministry allocated KRW 458 billion (US$327 million) for program operations.

Small business innovation vouchers will receive KRW 65.2 billion (US$47 million). The program will support 2,700 companies with consulting, technical support, and marketing assistance.

Technology protection programs will receive KRW 5.1 billion (US$4 million). This represents a 46.9 percent increase. The programs address intellectual property protection and legal costs for technology infringement cases.

A merger and acquisition support program for business succession will receive KRW 850 million (US$607,000). 

Awareness campaigns will receive KRW 150 million (US$107,000). Demand identification will receive KRW 350 million (US$250,000). 

Infrastructure development will receive KRW 350 million (US$250,000).

The ministry consolidated approximately 20 sub-programs. The consolidation followed recommendations from a government efficiency meeting held in August. 

The budget proposal requires National Assembly approval.

Exchange rate: US$1=KRW1390