The Ministry of SMEs and Startups (MSS) has expanded next year's budget to a record scale, concentrating fiscal resources on startups, artificial intelligence (AI), exports, and technology development. The ministry focused on strengthening a support system that spans from early-stage startups through growth to re-challenges, and on spreading policy effects to small business owners and local commercial districts.

Next year's budget draft compiled by the MSS totals 18.0724 trillion won, an increase of 1.5491 trillion won (9.4%) from this year.

Expanding Support by Growth Stage Is Key

The core of the budget is expanded support tailored to each stage of corporate growth. At the startup stage, the number of beneficiaries of the 'Startup for All' program will be expanded to 20,000. A total of 441.1 billion won has been allocated to 'Startup for All,' with the number of beneficiaries rising by 5,000 from before to 20,000. Staged commercialization funding will also increase by 10 million won from the previous level to a maximum of 30 million won.

The investment budget for the Fund of Funds, which serves as a source of venture capital, will also rise to 1.3 trillion won. The plan is for the government to strengthen its pump-priming role so that private investment can flow into early-stage companies, regional companies, and AI and deep-tech startups.

Support for regional startups will also be strengthened. A new 170 billion won has been allocated for the Regional Startup Package, which provides commercialization funds and settlement costs to companies located in startup cities or seeking to relocate to such regions. The Startup-Leading Universities program to invigorate deep-tech startups will receive 108.3 billion won, and 16.6 billion won has been newly allocated to a career startup support program for middle-aged and older entrepreneurs with experience and technology.

Expanded Budget for New Growth Industries and R&D

The government will also broaden support for new growth industries. A new 10 billion won will be invested in a program to identify 300 innovative companies in four sectors—new security and climate tech, pharmaceuticals and biotech, and K-consumer goods—and support them over the long term. A package program to support technology commercialization has been allocated 54 billion won, and 3.8 billion won has been earmarked for establishing a specialized investment institution through which the government directly invests in security-related innovative companies.

The budget for open innovation, which supports collaboration among large companies, public institutions, and startups, has been expanded to 54.3 billion won. Cooperation programs between global companies and domestic startups will receive 60 billion won, and nurturing startups in cutting-edge sectors will receive 156.3 billion won. For physical AI, which combines manufacturing sites with robotics and automation technology, a separate demonstration project has been newly established with 172.8 billion won allocated.

The R&D budget for SMEs will also expand significantly. The total SME and venture R&D budget is 2.5537 trillion won. The TIPS-style R&D program, in which the government provides follow-up R&D funding to companies that have first attracted private investment, has been allocated 1.3435 trillion won. A technology development program in which the government directly invests in corporate equity will also be newly introduced at a scale of 20 billion won.

The open R&D program, under which large companies, universities, research institutes, and overseas organizations jointly develop technologies with SMEs, has been allocated 259 billion won, and the SME Technology Innovation Development program 547.7 billion won. Technology commercialization guarantees will also be strengthened so that R&D outcomes lead to actual businesses. Based on a related budget of 93 billion won, the government plans to supply approximately 730 billion won in guarantees.

AI Transition for Growth-Stage Companies and Manufacturing

Support for companies entering the growth stage will also increase. The Jump Up program, which develops SMEs into mid-sized companies, has been allocated 164.2 billion won, and a new program to nurture promising companies linked to regional flagship industries will be created with 54.3 billion won.

A large budget will also go toward the AI transition of manufacturing. A total of 468.2 billion won has been allocated for the dissemination of smart factories and the establishment of joint AI transition models for large companies and SMEs, while 28.4 billion won will be invested in training manufacturing AI talent in cooperation with the four science and technology institutes including KAIST.

Export support methods will also be reorganized. The existing export voucher program will be changed to support companies divided into export entry and growth stages, with the related budget expanded to 313.7 billion won. Overseas market entry by large companies and SMEs together will receive 23.8 billion won, and responses to foreign export regulations 27.9 billion won. For domestic sales channel support, a new program providing customized marketing based on each company's circumstances will be introduced with 28.6 billion won.

Restructuring Policy Finance… Strengthened Re-challenge Support

The policy finance system will also be simplified. SME policy funds will be restructured into four categories: startup companies, growth companies, re-leap companies, and business stabilization. Startup company support has been allocated 1.6898 trillion won, growth companies 1.4898 trillion won, and re-challenge and leap support 840 billion won. Including these, direct lending totals about 4.4 trillion won, and if interest subsidies for private financial institution loans are included, the total financial support scale is about 5.4 trillion won.

Support for failed entrepreneurs seeking a second chance will also be strengthened. A new 59.5 billion won has been allocated to the Re-challenge Success Academy, which analyzes the causes of failure and provides psychological recovery and re-startup education. The intensive support program for successful re-challenge companies will receive 33.4 billion won, and the re-challenge success package 46.9 billion won.

Strengthening Safety Nets for Traditional Markets and Small Business Owners

Support for traditional markets and local commercial districts will also expand. A total of 56.2 billion won will be invested in improving safety facilities in traditional markets, and 42.7 billion won in developing traditional markets that combine tourism and cultural content. Local theme commercial districts combining regional food, culture, and experience content will receive 20 billion won, and the cultivation of global commercial districts targeting foreign tourists will receive 7.2 billion won.

The social safety net for small business owners will also be strengthened. A new policy insurance program will be introduced with 30 billion won, allowing young small business owners within five years of starting their businesses to receive support when facing suspension or closure. The Hope Return Package, which helps business owners rebound after closing, has been allocated 315.3 billion won, and a new program (205 billion won) has been established to cover business suspension costs and replacement personnel costs during small business owners' health checkups. Support for business owners' industrial accident insurance premiums has been allocated 4.2 billion won, and support for self-employed individuals' employment insurance premiums 19.9 billion won.

The small business financial support system will also change. The general business stabilization fund will be partially converted from direct lending to an interest subsidy method. Including this, the total small business financial support scale is about 4.25 trillion won, comprising 700 billion won in growth promotion funds, 1.3 trillion won in business stabilization funds, and 250 billion won in crisis response funds. A total of 260.7 billion won has been allocated to the re-guarantee program of regional credit guarantee foundations to reduce the guarantee burden on local small business owners.

A new 80 billion won will be invested in a program supporting manufacturing micro-enterprises and small business owners in the lifestyle and culture sector with product development, brand building, and sales channel development together. A total of 11.9 billion won has been allocated for education and consulting for digital transition support, and 124 billion won will be invested in supporting the public delivery app. The aim is to improve convenience for consumers, member merchants, and delivery workers while reducing dependence on private platforms.

A total of 24.7 billion won has been allocated to technology protection programs, including counseling and security infrastructure support, to protect SMEs from technology theft.

The MSS has set the direction of next year's budget not as a simple expansion of subsidies but as concentrating resources on high-growth-potential companies and small business owners. The structure aims to accelerate corporate growth through startups, R&D, AI transition, and exports, while providing re-challenge opportunities to companies that have experienced business crises or failure. At the same time, the ministry plans to strengthen support for traditional markets, local commercial districts, and small business owners to spread the growth effects centered on ventures and SMEs to the regional economy.

[This article was reconstructed for informational purposes based on public materials from the Ministry of SMEs and Startups. As the budget bill may change in scale and content of detailed programs during National Assembly deliberations, the final confirmed budget and implementation plans should be verified separately. AI assistance was used in the writing and restructuring of this article.]