Banks expand IP-backed loans in line with K-culture promotion drive

Seong Gi-hun (Lee Jung-jae) in “Squid Game" Season 3 / Courtesy of Netflix

Major commercial banks are accelerating the expansion of intellectual property (IP)-backed lending, offering financing secured by assets such as copyrights and patents, in line with President Lee Jae Myung’s recent push to promote Korean culture, industry officials said Tuesday.

These loans, based on companies’ technologies and creative content, align with the Lee administration’s goal of fostering productive finance, which seeks to redirect funds previously tied to real estate or dependent on interest income toward advanced industries.

At the same time, banks are building mutually beneficial ties with the content industry to enhance brand visibility through partnerships with popular K-dramas and webtoons, amid Korean culture’s growing global influence and commercial appeal.

By September, the total outstanding balance of IP-backed loans at Korea’s five major banks — KB Kookmin, Shinhan, Hana, Woori and NH NongHyup — reached 1.36 trillion won ($947 million), up from 1.34 trillion won at the end of last year.

Shinhan Bank has been increasing its IP-based financing for tech companies with patent holdings, offering about 30 billion won in guarantees under a partnership with the Korea Technology Finance Corp. (KOTEC).

Hana Bank, working with the Korea Credit Guarantee Fund (KODIT), is facilitating loans for small- and medium-sized enterprises involved in creating cultural products, including films, games, character brands and music.

KB Kookmin Bank has partnered with KODIT, KOTEC and the Korea Creative Content Agency to provide guarantees totaling 100 billion won, bolstering financial support for content companies and helping them expand overseas.

Woori Bank, through collaborations with regional IP centers under the Korea Intellectual Property Office, extends credit to companies holding valuable intellectual property.

Banks are increasingly expanding IP-backed lending not only because the Lee administration is actively promoting Korean culture, but also because high-value IPs serve as low-risk collateral.

Unlike typical retail or wholesale companies, which often receive lower scores for innovation or future growth in technology credit assessments, patents, copyrights and other IP assets are recognized as relatively high-value collateral.

“Banks are working to leverage their internal capabilities to conduct in-house IP valuations. The accumulated data allows for faster review and execution of IP-backed lending,” an industry official said.