Ministry of SMEs and Startups Expands Opportunities for Smart Manufacturing Innovation for Small Manufacturers

Additional Recruitment for the Smart Manufacturing Support Project for Small Manufacturers

The Ministry of SMEs and Startups announced on June 14 that it will conduct an additional recruitment round for the "2026 Smart Manufacturing Support Project for Small Manufacturers" to support the digital transformation of manufacturing sites.

On April 28, the Ministry introduced a restructured plan for the Smart Manufacturing Support Project for Small Manufacturers, aiming to prevent fraudulent subsidy claims and enhance the program’s effectiveness. The eligibility criteria for project participation were improved accordingly. This additional recruitment round was launched to reflect feedback from the field following the program’s restructuring.

Key changes announced in April include: ▲ introduction of a competency evaluation for supplier companies; ▲ strengthened verification of equipment costs for small manufacturers; ▲ support limited to small manufacturers with annual sales of at least 200 million won; ▲ an increase in the self-funding ratio from 30% to 40%; and ▲ a shift from written to video-based project proposal submissions.

Following the program’s restructuring, while there was general agreement on the need to prevent subsidy fraud and strengthen transparency, some stakeholders argued that the system should be further revised to allow more small manufacturers to participate in smart manufacturing support. In particular, industry representatives pointed out that the sales threshold excluded micro-enterprises with less than 200 million won in annual sales, despite their strong growth potential. The small manufacturing sector suggested that, given the enhanced supplier competency evaluations, stricter cost verifications, and strengthened self-regulation within the industry, support opportunities should be provided to all small manufacturers who need smart manufacturing adoption, regardless of their sales size. Additionally, there were concerns that some expressions in the compliance pledge included in the video project proposal were excessive.

In response, the Ministry held two on-site meetings with organizations such as the Korea Federation of Small Manufacturers and the National Urban Small Manufacturers Association to gather feedback and discuss improvements. These organizations agreed to strengthen their self-regulation efforts to prevent the recurrence of fraudulent subsidy claims. They plan to expand training on subsidy-related laws and compliance for member companies and support capacity building so that small manufacturers can directly implement projects. Furthermore, they will reinforce reporting and preventive measures against unfair practices such as price inflation, paybacks, and proxy applications, actively cooperating to eradicate subsidy misuse.

Based on these consultations, the Ministry has prepared improvement measures that reflect on-site feedback. Firstly, an additional recruitment round will be conducted for small manufacturers with less than 200 million won in annual sales, aiming to accelerate the digital transformation and improve productivity and competitiveness among micro-enterprises with growth potential. The Ministry will also revise the language regarding fraudulent claims in the video project proposal and provide sample videos to make the video production process easier for small manufacturers. However, to encourage responsible and proactive participation, the self-funding ratio will remain at 40% as previously established.

Lee Byungkwon, the Second Vice Minister of the Ministry of SMEs and Startups, stated, "Digital transformation is essential for the sustainable growth and competitiveness of small manufacturers. We will actively incorporate field feedback to expand support so that more small manufacturers can benefit from manufacturing innovation, and we will continue to strengthen our management system to ensure the project operates more transparently and fairly."

This content was produced with the assistance of AI translation services.