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Guarantee-aligned Equity Investment


Guarantee-aligned Equity Investment is a business, introduced in 2005, through which KODIT provides investments with credit guarantee combined.

It aims to move away from conventional loan-centered SME financing and to enable SMEs to procure funds through direct financing.



Eligibility is open to unlisted SMEs deemed to have outstanding technological capacity, competent management, and positive business prospects and that use KODIT credit guarantee or have applied for the investment and guarantee at the same time. KODIT makes over 50% of its annual investment on startups.


Applications for guarantee-aligned equity investment are primarily received at KODIT’s startup branches. Such investment can go only to companies that have to be qualified for KODIT’s credit guarantees. The procedure of investigation, review, and follow-up management is applied. If an investment is successful such as a company getting listed (IPO), it is considered recovered and thus completes the procedure.

The maximum limit on guarantee-aligned equity investment is KRW 3 billion, which can be reduced according to applicants’ credit ratings. The investment is made through acquiring newly issued stocks, convertible bonds, or bonds with warrants. For securities, investment is maintained for at least three years but no more than 10. The investment period could also be adjusted considering potentials for IPO.

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