Korean banks expanding IP-backed loans using ‘K-Culture’ content as collateral, as South Korean government pushes to monetise global successes

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The explosive growth of K-Pop and other South Korean creative industries internationally – collectively termed K-Culture or the ‘Korean Wave’ – is driving increased IP-backed lending activity from the country’s major banks, finance industry officials have said.

South Korean newspaper the Korea Times says President Lee Jae Myung’s recent push to promote Korean culture globally, and his administration’s suggestion earlier this year that banks should switch from investing in real estate and similar interest-bearing but ‘non-productive’ investments towards providing funds for productive sectors, such as artificial intelligence, high tech and innovative and creative industries, is fuelling a focus on IP-backed lending, not just to patent owning companies but also to creative companies which have significant copyright and design IP.

The Korea Times article adds: “At the same time, banks are building mutually beneficial ties with the content industry to enhance brand visibility through partnerships with popular K-dramas and webtoons, amid Korean culture’s growing global influence and commercial appeal.”

Korea Times reports that by September 2025 “the total outstanding balance of IP-backed loans at Korea’s five major banks — KB Kookmin, Shinhan, Hana, Woori and NH NongHyup — reached 1.36 trillion won ($947 million), up from 1.34 trillion won at the end of last year.”

Banks are no longer just focusing on patent owning companies; many have launched significant support products for content creators, the paper says.

For example, Hana Bank works with the Korea Credit Guarantee Fund (KODIT) to provide loans for SMEs involved in creating films, games, character brands and music, while KB Kookmin Bank has partnered with KODIT, KOTEC and the Korea Creative Content Agency to provide guarantees totalling 100 billion won to help content companies expand outside Korea.

The Korea Times points out that banks are expanding their lending against creative content because such IP rights are seen as low-risk collateral (as are patents).

“Banks are working to leverage their internal capabilities to conduct in-house IP valuations. The accumulated data allows for faster review and execution of IP-backed lending,” an industry official told the newspaper.

However, the success of the Korean Wave internationally has made many Korean content creators question who is actually profiting.

For example, one of the most obvious examples of Korean culture to enjoy significant international success recently is the TV show Squid Game. But arguably it is Netflix that is profiting most from Squid Game, as it apparently owns the IP. Similarly, current box office hit KPop Demon Hunters, also on Netflix, was made by Sony Pictures in North America. While obviously heavily based on KPop, it was actually created by a Korean-Canadian, Maggie Kang, who was a co-director on the film. Under Sony’s deal with Netflix, the streaming platform paid for production costs and gave Sony a guaranteed $20m profit, in return for all IP rights.

A report on IP commercialisation released in August 2025 by the Korea Chamber of Commerce and Industry (KCCI) pointed out that none of the world’s top 50 licensors were South Korean, despite the success of the Korean Wave. KCCI called for more investment in Korean content creation, including a special fund so Korean creative IP owners would not have to rely on investment from foreign media companies, and Government support for Korean creators to register their IP around the world.