Gyeonggi-do Offers Up to 3 Million KRW Loans at 1% Annual Interest for Ultra-Low Credit Borrowers

[Asia Economy (Suwon) = Reporter Lee Young-gyu] Gyeonggi Province will resume the 'Ultra-Low Credit Loan' program next month.

Gyeonggi Province announced on the 25th that from the 15th of next month, it will accept second-round applications for the 'Ultra-Low Credit Loan,' which provides loans of up to 3 million KRW at an annual interest rate of 1% to low-credit borrowers who have suffered damages from illegal private loans.

The Ultra-Low Credit Loan program offers residents with a credit rating of 7 or lower an automatic loan of 500,000 KRW at 1% annual interest with a 5-year term. After screening, borrowers can receive up to 3 million KRW.

The province previously secured a total budget of 50 billion KRW to overcome the COVID-19 crisis.

The province has newly established the 'Illegal Private Loan Victim Loan' under this program.

Lee Byung-woo, Director of the Welfare Bureau of the province, explained the purpose of the program, saying, "Low-credit borrowers who find it difficult to get loans from formal financial institutions such as banks sometimes inevitably resort to illegal private loans even for small amounts, which leads to damages such as high interest rates and illegal debt collection. The province has established the 'Illegal Private Loan Victim Loan' system to prevent damages from illegal private loans in advance and to eradicate illegal lending businesses."

The Illegal Private Loan Victim Loan targets Gyeonggi residents with a credit rating of 7 or lower who suffered damages from illegal private loans before the 1st of next month.

If the victim reports the damage to the Financial Supervisory Service's Illegal Private Loan Reporting Center, police stations, or other authorities, loans of up to 3 million KRW per person will be provided depending on the extent of the damage.

Additionally, the province plans to take measures such as requesting investigations by the Gyeonggi Provincial Special Judicial Police and prosecutors against malicious high-interest lending businesses.

For detailed inquiries about loan application methods and required documents, please use the dedicated call center for 'Gyeonggi Ultra-Low Credit Loan' (1800-9198) or the 'Ultra-Low Credit Loan Bulletin Board' on the Gyeonggi Welfare Platform (ggwf.or.kr).

Meanwhile, as a result of the first round of the Gyeonggi Ultra-Low Credit Loan conducted from April 10 to 17, the province supported a total of 36,393 people, including 30,145 who received automatic loans and 6,248 who received screened loans, with loan amounts ranging from 500,000 KRW to 3 million KRW.

The second round of the program is expected to support about 20,000 people. The province plans to hold a third additional application round in the second half of this year.

Earlier, on the 23rd, Gyeonggi Governor Lee Jae-myung posted on social media (SNS) a message titled "Loan sharks targeting young people in their 20s by baiting with jobs," urging, "Please report to Gyeonggi Province. We will definitely catch illegal loans. The program to provide loans at 1% annual interest to victims of illegal loans will also start in July," announcing the implementation of the 'Illegal Private Loan Victim Loan' system.

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