Frozen Loan Market... Kookmin Bank Suspends Credit Loans Over 20 Million Won Starting Today

Effectively Handling Only Small and Emergency Loans
Major Banks Cease Services One After Another
Concerns Over Funding Difficulties for Living Expenses

Bank Loan Counter Reference Image (Source=Yonhap News)

[Asia Economy Reporter Kim Hyo-jin] As financial authorities tighten restrictions on household loans in the financial sector toward the end of the year, it has become difficult to obtain even credit loans exceeding 20 million won. Banks are raising regulatory measures by consecutively suspending loan products and completely blocking credit loans, increasing concerns among borrowers who urgently need new loans at year-end.

According to the banking sector on the 22nd, KB Kookmin Bank decided not to approve household credit loans exceeding 20 million won from this day until the end of the year. Exceptions apply if the desired loan date is after January 4 of next year, or if the initial submission date of loan documents was before the 21st, as well as for credit loans supported by the government for low-income earners (such as KB Sa-itdol Mid-interest Loan, KB New Hope Holssi II, KB Happiness Dream Loan II). A KB Kookmin Bank official explained, "This is a measure to suppress risk expansion at year-end."

Other banks have already closed their loan doors one after another. There is a high possibility that additional loan management measures will be introduced depending on the situation. Shinhan Bank has blocked non-face-to-face credit loans for office workers, such as the 'Solpyeonhan Office Worker Credit Loan,' since the 15th, and Woori Bank stopped selling the 'Woori WON Office Worker Loan' from the 11th.

NH Nonghyup Bank is tightening loans by reducing the limit of non-face-to-face credit loan products by 50 million won, among other methods, and Hana Bank plans to implement regulations such as lowering the basic limit for professional credit loans by 100 million won as early as the end of this month.

The loan freeze is expected to continue for the time being next year as well. Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, said at the 12th Real Estate Market Inspection Ministerial Meeting held at the Government Seoul Office on the same day, "We will continuously monitor to ensure that the announced measures to strengthen management of high-value and high-income credit loans are implemented without disruption," adding, "We will manage household liquidity by preparing an 'Advanced Household Debt Management Plan' to induce credit screening based on repayment ability in the first quarter of next year."

They also plan to review measures such as household loan management plans including credit loans, applying borrower-level total debt service ratio (DSR) to high-value and high-income credit loans, and strengthening post-management of high-value credit loans.

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