Financial sector to extend the microfinance contribution system until 2036

[Financial News] The financial institutions' contribution system for microfinance, which was scheduled to expire early next month, will be extended for another 10 years.
On the 2nd, the 1st Subcommittee on Bill Review of the National Policy Committee reviewed an amendment to the Act on Support for the Financial Lives of Ordinary People (Microfinance Support Act) and, through an agreement between the ruling and opposition parties, passed a resolution to extend the sunset period of the financial institutions' contribution system by 10 years.
Under current law, financial institutions such as banks are required to contribute a certain amount to the Korea Inclusive Finance Agency. The funds raised through these contributions are used to provide policy-based microfinance to low-income individuals and people with low credit scores.
The current contribution system was set to expire on October 8, but under the amendment passed by the subcommittee on this day, it will remain in effect until October 8, 2036.
However, the plan to establish and stably operate a separate fund for microfinance was not addressed on this day. The ruling and opposition parties plan to discuss it again after further review.
The subcommittee also discussed an amendment to the Financial Investment Services and Capital Markets Act that would introduce a mandatory tender offer system, requiring an acquirer in a listed company's merger and acquisition (M&A) process to purchase shares held by general shareholders above a certain percentage. The ruling and opposition parties agreed in principle that, after acquiring management control, the acquirer should secure at least '50% + 1 share' of the total issued shares through a tender offer. However, they agreed to continue discussing the specific application requirements and system design.
The National Policy Committee plans to form a separate small subcommittee to coordinate the outstanding issues and then prioritize the review of bills related to the mandatory tender offer system at the Bill Review Subcommittee meeting scheduled for the 15th.

[email protected] Song Ji-won Reporter