The South Korean government has announced a significant expansion of its microfinance program aimed at supporting the youth demographic, raising the funding from 30 billion to a target of 300 billion won by 2028. This initiative, presented by the Financial Services Commission at a conference aimed at inclusive finance, also includes measures to enhance accessibility to financial products for young people and vulnerable communities. The plan is to increase the annual supply of microfinance from the current 300 billion won to 600 billion won over the next three years.

In an effort to improve financing support for the youth, a new loan product called 'Youth Future Connection Loan' will be introduced, offering young individuals in precarious employment situations favorable terms. This product will provide loans up to 5 million won at an interest rate of 4.5%, allowing a grace period of up to six years during which only interest needs to be paid, followed by a five-year repayment period for the principal. Additionally, financial advice will be mandated for loan applicants to ensure they do not receive one-off support but rather sustainable financial assistance.

For young self-employed individuals outside the capital area, the loan ceiling for operational funds will increase from 20 million to 30 million won, and the grace period will extend from six months to two years. Furthermore, local governments will provide interest support in addition to the incentives already available, which will vary based on regional characteristics, including distance from the capital and population decline. The Financial Services Commission emphasized the need for inclusive financial access, particularly for the young and economically vulnerable, ensuring that financial resources flow unimpeded to the most disadvantaged sectors of society.