Ministry of SMEs and Startups, KB Financial to launch 10 billion-won co-prosperity initiative

The Ministry of SMEs and Startups announced Thursday that KB Financial Group will contribute 10 billion won ($7.26 million) to the large-SME co-prosperity fund.

The contribution aims to strengthen the self-reliance of small and medium-sized enterprises and small business owners and to advance inclusive finance.

KB Financial plans to use the fund to support the sustainable growth of small and medium-sized enterprises and small business owners through three programs — AI transformation (AX), green transformation (GX) and safety transformation (SX) — alongside the establishment of a co-prosperity mother fund.

Through the initiative, the Ministry of SMEs and Startups and KB Financial plan to strengthen the competitiveness of small and medium-sized enterprises in digital, eco-friendly and safety sectors and to spread a culture of social responsibility encompassing ESG (environmental, social and governance) management and community value creation.

The contribution is notable as the first joint cooperative project under the co-prosperity fund to extend support beyond the existing model — which focused on partner companies of contributing firms — to include small and medium-sized enterprises and small business owners with no prior cooperative relationship with the contributor.

The Ministry of SMEs and Startups and the Korea Commission for Corporate Partnership will jointly carry out the related programs based on KB Financial's contribution.

In addition, KB Financial's investment in the co-prosperity mother fund marks the first time the co-prosperity fund has invested in a venture fund. Returns are expected to flow back into the co-prosperity fund, enabling continuous reinvestment.

The AX program targets digital competitiveness among small and medium-sized enterprises and small business owners. It will provide AI-based digital solutions to regional manufacturing companies and smart ordering and customer analytics marketing systems to small business owners, supporting the revitalization of local industries and commercial districts.

The GX program will offer tailored climate finance education to supply chain small and medium-sized enterprises and provide consulting to help their facilities, environmental practices and overall management meet the standards of the Korean Green Taxonomy (K-Taxonomy), improving access to green finance.

The SX program supports small and medium-sized enterprises with safety technology as well as small businesses in safety blind spots. Companies with safety technology will receive consulting to expand their sales channels and boost revenue, while small businesses will receive free AI CCTV, sensor-based safety detection systems and industrial safety consulting.

The co-prosperity mother fund will pursue impact investment in companies linked to community-based social ventures, promoting local economic vitality and social value creation. KB Financial will contribute 3 billion won to the first co-prosperity mother fund, and the sub-funds will identify and invest in companies aligned with the UN Sustainable Development Goals.

As ESG management requirements tighten across global supply chains, the compliance burden on small and medium-sized enterprises is growing. The EU's Carbon Border Adjustment Mechanism (CBAM) and the expansion of supply chain due diligence regulation are demanding environmental and safety management capabilities not only from export companies but also from their suppliers. With small and medium-sized enterprises struggling to respond due to shortages of specialized personnel and funding, observers say the importance of a co-prosperity support model involving government, the financial sector and large companies together is greater than ever.

"At a time of rapid change in the industrial landscape, cooperation and co-prosperity among large companies, small and medium-sized enterprises and the financial sector are more important than ever," said Han Sung-sook, minister of SMEs and Startups. "The government will spare no effort in providing policy support and publicity so that these exemplary cases of co-prosperity can spread actively across the broader industrial community."