Hong Nam-ki: "Finance to Become a Strong Support as the 'Lifeblood of the Economy'"

[Image source=Yonhap News]

[Asia Economy Reporter Kwangho Lee] Deputy Prime Minister and Minister of Strategy and Finance Hong Nam-ki said on the 3rd, "In the loan system, please focus on efforts to establish credit practices centered on technology and growth, along with new attempts such as movable property collateral loans, contract-based loans, and blanket collateral."

Deputy Prime Minister Hong attended the '2020 Pan-Financial New Year Meeting' held at the Shilla Hotel on the same day and stated, "I hope that finance will become a strong supporter as the 'lifeblood of the economy' for this year's economic rebound and growth recovery."

Hong Nam-ki pointed out concerns about the so-called economic 'money clots' due to real estate and household-centered loans, emphasizing, "I expect the flow of funds to be redirected to more productive sectors and investments."

He also expressed that the financial sector's role transition as an investor is important alongside loans. He said, "In an era where everything is uncertain, challenges in uncharted areas are a time to create new wealth," adding, "Therefore, sufficient venture capital that appropriately diversifies risks from challenges must be supplied. I request more interest and direct and indirect roles from the financial sector in this area."

He further urged for more active interest in inclusive finance. He said, "It is not just because of social responsibility. If finance further advances credit evaluation, it can provide more opportunities for self-reliance, rehabilitation, and challenges to the underprivileged through market functions," and requested, "Please make special efforts in supplying finance for the underprivileged and supporting debt adjustment."

Deputy Prime Minister Hong also emphasized the need for changes and innovation efforts within the financial industry itself.

First, he said, "We must accelerate digital innovation in finance," mentioning, "A global consulting firm's report last year warned that 'one-third of the world's banks will disappear without innovation,' which is a concerning point but worth reflecting on."

He also stated, "We must actively utilize newly established systems such as regulatory sandboxes and open banking for various financial services," evaluating, "Among 195 regulatory sandbox cases last year, 77 cases (40%) were related to the financial sector. There were many attempts reflecting consumer needs, such as allowing insurance sales by robot tellers and intermediary services for overseas remittances."

He added, "Among the global top 500 companies selected by Fortune last year, only two domestic financial companies (Samsung Life Insurance ranked 426th, KB Financial Group ranked 434th) were included," pointing out, "We must also strive harder to strengthen the global competitiveness of the financial industry."

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