Pandemic-struck independent studios, cable networks to receive gov't loans

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By Park Han-sol

In response to the dramatic changes the contents and broadcasting industry has undergone during the COVID-19 pandemic, the government will provide a new line of loan support to companies in the industry and increase the amount of loans, according to the Korea Creative Content Agency (KOCCA), Wednesday.

For small production studios and cable network program providers, which have been heavily affected after the outbreak of coronavirus cases with cancellations or suspension of filming, KOCCA will work with financial institutions to arrange 15 billion won ($13.2 million) worth of loans, an increase of two billion won compared to last year.

Its goal is to help small studios and network providers produce televised programs, establish necessary infrastructure and stabilize their operation. Qualifying companies can receive up to 1.5 billion won over a two-year period.

For the general contents industry, KOCCA will select a list of outstanding enterprises to be recommended to the Korea Credit Guarantee Fund (KODIT). The companies will then be subject to KODIT's own evaluation to receive credit guarantees.

The loan support system is divided into four tracks, including a newly established guarantee program that aims to strengthen the international competitiveness of so-called “K-contents” in the post-COVID-19 period. Accordingly, those eligible for this track are local content-producing firms specializing in global contents or contents based on cutting-edge technology.

Another track within the support system will focus on providing financial aid for licensing and commercializing the intellectual property (IP) of contents. Companies can also offer their future content projects as collateral to receive production loans. This credit loan will typically amount to 1.5 billion won, but can reach up to 3 billion won for film and broadcasting projects.

“We hope the policy will allow K-contents firms to keep growing and challenge themselves to lead the transition into the digital economy in the post-COVID-19 era,” said Kim Young-jun, president of KOCCA. “To achieve this, the agency will continue to cooperate with the financial sector to secure relevant funds and expand the scope of its loan support.”