7~8% High-Interest Savings?…Visiting Banks Reveals It's Just a Pipe Dream

To Get Cashback and Other Benefits, Fill Spending for Check Card Issuance
Must Also Open Securities Account and Insurance...Criticism That Bait Costs More Than the Catch

[Asia Economy Reporter Kim Min-young] On the afternoon of the 16th, at a Shinhan Bank branch in Seoul, a reporter who visited the bank upon hearing the news of a savings product offering an 8% annual interest rate was soon disappointed after listening to the bank clerk’s explanation. This was because, in pursuit of high interest rates, they encountered the towering "preferential conditions" mountain.

The basic interest rate of the recently launched "Shinhan Plus Membership Savings" by Shinhan Financial Group is 1.2%, with an additional 0.3% preferential interest rate if automatic transfer is set up from a Shinhan Bank deposit and withdrawal account, and another 0.3% if the customer has not recently subscribed to a savings product. With these simple conditions, one can secure an interest rate of 1.8%, which is not bad as a subscription condition in today’s ultra-low interest rate era.

The problem starts from here. To receive the Shinhan My Point cashback benefit of up to 6.5%, a difficult process must be followed. First, one must sign up as a member of Shinhan Financial Group’s mobile membership platform "Shinhan Plus" and agree to all terms and conditions. This qualifies for a 1.0% point preferential benefit. Additionally, the customer must issue a Shinhan Plus Membership check card and spend a total of 300,000 KRW or more over at least 3 months from the savings subscription date until 10 days before maturity. This adds another 0.5% points (1.5% points for first-time Shinhan check card customers). To gain an additional 4.0% points preferential benefit, during the savings subscription period, one must open a securities account at Shinhan Investment Corp. and purchase stocks (2.0% points), and also subscribe to Shinhan Life’s pension savings insurance (2.0% points).

This product is a 6-month maturity savings account with a monthly savings limit of 300,000 KRW. The interest earned from depositing 300,000 KRW monthly for 6 months is 9,450 KRW (before tax), and the amount received back in points is calculated to be 34,125 KRW. The reporter ultimately gave up on subscribing to the product.

As commercial banks hurriedly launched high-interest products one after another through cross-industry alliances in response to Naver and Kakao’s attempts to dominate the market with high interest rates, criticism has arisen that these are typical bait products with complicated preferential conditions. Meeting all the conditions to receive the preferential benefits often requires spending more money than the interest earned, leading to the saying "the belly button is bigger than the belly."

Savings products that require credit card usage performance as a condition are similar. SC First Bank recently partnered with Samsung Card to offer a savings product with an interest rate of up to 7%. The basic interest rate is 1.6%, and a cashback of 5.4% is given only if there is a credit card usage performance of 3.6 million KRW over the one-year subscription period. The maximum amount receivable when depositing 250,000 KRW monthly for one year is about 110,000 KRW. However, one must spend as much as 3.6 million KRW on the card.

Woori Bank also introduced a product offering a 5.7% interest rate in collaboration with Hyundai Card. For first-time customers of Woori Bank, if they have an annual Hyundai Card usage performance of over 6 million KRW, they receive a 3.0% point preferential interest rate, and existing customers receive a 1.0% point preferential rate if they spend over 10 million KRW annually. To earn more interest, one must use the card nearly 500,000 to 1,000,000 KRW monthly.

Experts advise, "Since you may be disappointed at maturity if you subscribe based only on the interest rate, you should carefully examine the conditions before subscribing." A financial industry insider hinted, "It is true that banks have become anxious as big tech companies like Naver and Kakao have begun full-scale entry into the financial sector, with Naver Financial launching the ‘Naver Account’ offering 3% interest and 3% points."

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