What Was Decided at the August 27 Fiscal Strategy Council
The government has launched a large-scale spending restructuring across its SME support portfolio. At the Fiscal Management Strategy Council on August 27, a full review of 671 SME support programs worth KRW 31 trillion across 22 ministries identified 472 programs worth KRW 25.5 trillion across 17 ministries as targets for efficiency measures — 70% of all programs and 82% of the budget.
Specifically, the plan calls for consolidating or abolishing 88 programs and reducing funding for 144 more, affecting 232 programs in total and saving roughly KRW 4 trillion. The critical point is that this KRW 4 trillion does not disappear from the budget. The government has stated it will be reinvested into strategic programs, including support for innovative firms in new growth sectors. In other words, this is not a reduction in total spending but a reallocation of who receives it.
This restructuring runs on a separate track from the 2027 total budget framework or the semiconductor special account debate. Even in sectors where budgets are growing, a company whose regular program is slated for consolidation may experience a real decline in support.
Four Categories Under the Knife — Where Do Your Programs Fall?
Restructuring targets fall into four broad types.
The first practical step is to classify every program your company has received over the past three years by ministry and by objective. If you have received support for the same purpose from two or more ministries, those programs are likely consolidation candidates. Also flag small programs providing under KRW 20 million per company and programs whose announcement terms have barely changed in three years.
The New Rules from 2027 — The Growth-Potential Screening System
The more consequential change is not the number of programs but how applicants are screened. From 2027, the Ministry of SMEs and Startups will introduce a growth-potential screening system as a pre-qualification filter across SME, startup, and small-business support programs.
The fact that the growth criterion accepts either revenue or employment matters in practice. A manufacturer whose headcount has flattened due to automation can qualify on revenue, while an early-stage scale-up with volatile revenue can build its path through employment figures. The potential criterion does not rely on financial statements alone — patents, in-house R&D centers, certifications, and transaction stability all become non-financial screening inputs.
What you must verify is how the two criteria are combined. If they apply as "or," meeting one is enough; if they apply as "and," you must manage growth metrics and technology ratings simultaneously. This is likely to be designed differently program by program, so make this clause the first thing you check in the eligibility section of any 2027 announcement.
A Six-Month Preparation Checklist
A Consulting Perspective: Eligibility, Not Volume
Many companies have applied to multiple programs in parallel, hoping at least one lands. Once pre-screening is in place, that approach becomes a liability: failing the filter blocks you across every program equally, regardless of how many applications you submit.
The alternative is to assess your own growth metrics and technology ratings first, then narrow the field to programs you can realistically clear.
KITIM offers a free corporate diagnosis to review your growth and potential indicators in advance, and uses AI-based program matching to realign your target list around consolidation impact and eligibility. If you need a response strategy in place before the 2027 rules take effect, we invite you to get in touch.