The government is planning measures to support local start-ups after a rise in COVID-19 infections in Taiwan, National Development Council Minister Kung Ming-hsin (龔明鑫) said after attending a videoconference with several industry representatives on Friday.
Local start-ups face more difficulties when applying for relief funds or subsidies, as well as when securing credit lines from banks, because they are generally smaller, have not yet started to generate revenue, or their business models or operational schemes do not qualify for relief funds based on current policies, the council said.
SERIOUSLY AFFECTED
Photo courtesy of the Executive Yuan
As a result, start-ups tend to be more seriously affected by the pandemic than other businesses, the council said.
To help start-ups overcome the difficulties, the government is planning to provide more relief funds to struggling start-ups, allow for a more flexible interpretation of financial subsidies for such firms and help start-ups in their investments, the council said.
The council said it held discussions with the management committee of the Executive Yuan’s National Development Fund, the Ministry of Economic Affairs, and representatives from small and medium-sized enterprises to make more start-ups eligible for relief funds, offer them high credit guarantees and provide them with higher loan amounts or more favorable interest rates.
Considering local start-ups’ urgent need for funds, the government would also simplify follow-up administrative procedures for such firms, the council said.
FLEXIBILITY
As the business scope of some start-ups covers multiple industries, which has made it difficult to categorize and qualify them for relief funds, Kung said he has negotiated with the economics ministry and related government agencies to handle start-ups that have been negatively affected by the pandemic in a more flexible manner.
Early last year, when COVID-19 was starting to take hold worldwide, the council presented a special investment option to help local start-ups, offering six to 12 months of funding in exchange for preferred stocks in the firms.
The council would consider whether to continue the investment scheme this year to reduce the financial pressure on local start-ups, Kung said.
The measures are subject to approval by the fund, which is expected to discuss them at a meeting tomorrow.
The videoconference was attended by Taiwan Venture Capital Association chairman Andy Chiu (邱德成), Digital Economy Association Taiwan chairman Jeffrey Wu (吳昕霈), Asia America Multi-Technology Association chief executive officer Jasmine Lin (林蓓茹) and Taiwan Association for Virtual and Augmented Reality chairman Andy Peng (彭子威), as well as the economics ministry’s Department of Commerce Deputy Director-General Chen Mi-shun (陳秘順), among others.
Additional reporting by staff writer
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