The preferential savings deduction for employees of small and medium-sized enterprises is a policy financial product created by the Ministry of SMEs and Startups, Korea Small and Medium Venture Business Corporation, Industrial Bank of Korea and Hana Bank to encourage employees of small and medium-sized enterprises to serve long-term and to support asset formation.
If an employee of a small and medium-sized company pays KRW 30 million, 500,000 won per month for five years, an additional KRW 10.27 million can be added at maturity to receive KRW 4.27 million.
The Ministry of SMEs and Startups expected that it would have the effect of raising returns of up to 34%, which would be effective in forming assets and easing the wage gap.
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