Seoul City Conducts Intensive Crackdown on Illegal Loan Companies Ahead of Seollal Holiday

Intensive Crackdown on 101 Loan Companies
Fines and Business Suspensions for Violators
Report Damage to 'No More Tears' and 120 Dasan Call Center

[Asia Economy Reporter Hyunju Lee] The Seoul Metropolitan Government announced on the 15th that it will conduct a focused crackdown on loan companies engaging in illegal activities such as high-interest daily loans targeting low-income earners ahead of the Lunar New Year holiday.

From the 20th of this month to the 28th of next month, the city will carry out a focused crackdown on 101 loan companies located near small and medium-sized traditional markets in Seoul or suspected of illegal loan advertisements.

The main items under inspection include illegal high-interest daily loans (up to 24%), illegal debt collection (assault, threats, leakage of personal information), illegal loan advertisements through spam (false or exaggerated advertisements, disclosure of loan conditions), as well as the contents of loan contracts (interest rates, repayment methods, incidental costs, early repayment conditions, handwritten entries), restrictions on overdue interest rates (contracted interest rate + 3%), and illegal collection of collateral-related costs (legal scrivener fees, appraisal fees, notarization fees).

In particular, this crackdown will focus on illegal practices in ultra-short-term high-interest daily loans targeting market merchants, where loan handling fees are deducted in advance and only the remaining amount is disbursed as the loan principal.

The Seoul Metropolitan Government plans to impose administrative measures such as fines and business suspension on the detected companies. Especially if violations of interest rates or illegal collection activities are found, administrative actions will be taken along with requests for investigation to encourage loan companies to be vigilant and exercise self-caution.

Meanwhile, if you have suffered damages due to illegal or unfair practices by loan companies, you can seek assistance by reporting to the Illegal Loan Business Damage Report Center, Seoul’s Civil Complaints Reporting System "No More Tears," or by calling 120 (Dasan Call Center) without an area code.

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