Busan Social Solidarity Fund Surpasses $7 Million Milestone, Fostering Inclusive Finance Through Labor-Management Partnership

A unique philanthropic model is taking root in Busan, South Korea, driven by the collaborative efforts of Busan Bank's employees and management. The Busan Social Solidarity Fund, established in 2019, has now surpassed 10 billion won (approximately $7.3 million USD) in donations, marking a significant milestone. This achievement is largely fueled by consistent monthly contributions from over 40% of the bank's 3,000 employees, who voluntarily donate 0.5% of their base salary, matched by the company's substantial contributions.

The fund's mission is to practice "inclusive finance" by supporting financially marginalized groups, such as small business owners and low-income individuals. It operates through various programs, including 'Hamkke Shop,' which provides unsecured, low-interest startup loans up to 30 million won (approx. $22,000 USD) with consulting support for vulnerable individuals and youth. Since 2023, nine startups have received 400 million won (approx. $290,000 USD) through this program, all successfully repaying their principal and achieving self-sufficiency.

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We established the Busan Social Solidarity Fund to practice inclusive finance. Without the continuous participation of our employees, who have willingly joined the donation drive for eight years, and the dedication of those who operate the fund, surpassing 10 billion won would have been difficult.

Another initiative, 'Hope Store,' offers startup loans up to 40 million won (approx. $29,000 USD) and consulting to single mothers and female heads of households in the Busan and Gyeongnam regions. To date, 21 recipients have received 1 billion won (approx. $730,000 USD), with one beneficiary fully repaying her loan in February after receiving 40 million won in 2017 at a 2% annual interest rate.

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I was planning to open a gym while working as a martial arts athlete, but I was short 30 million won and looked for a bank loan. It was difficult. Fortunately, I received an unsecured loan of 30 million won from the Busan Social Solidarity Fund with a 1% annual interest rate and a five-year principal repayment term. I was able to open my gym in November last year, and it's doing well.

The fund also aids small business owners through the 'Golmok Golmok' project, assisting with the replacement of outdated equipment for 261 businesses, disbursing 300 million won (approx. $220,000 USD). For platform workers, the 'Mindulle' program offers small loans up to 1 million won (approx. $730 USD) at a 1% annual interest rate and a matching savings program. Furthermore, 'Deokium' supports social enterprises facing early-stage funding challenges, providing 390 million won (approx. $285,000 USD) to 11 companies.

A distinctive aspect of the Busan Social Solidarity Fund is its "virtuous cycle structure." Beneficiaries who achieve success are encouraged to become donors themselves. Since the first "virtuous cycle donation" in 2023, 38 former recipients have contributed 6.33 million won (approx. $4,600 USD) back to the fund. This innovative approach not only provides crucial financial support but also cultivates a sustainable ecosystem of social contribution, demonstrating a powerful example of corporate social responsibility and community engagement.

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Bank loans were blocked, so I accidentally found information about the Hope Store online and applied for a loan. I received an unsecured loan of 40 million won at an annual interest rate of 2% in August 2017 and fully repaid the principal in February this year.