One-Time Visit to Previous Financial Institution for Retirement Pension Transfer...Significant Reduction in Required Documents

[Asia Economy Reporter Ji-hwan Park] From now on, when a company transfers DB, DC, or corporate-type IRP (Individual Retirement Pension) to another financial company, the new financial company receiving the transfer only needs to be visited once. Additionally, the number of documents submitted will be drastically reduced from up to seven to just one or two.

On the 3rd, the Financial Supervisory Service announced that starting from the 4th, transfers between the same retirement pension systems will be simplified to require only one visit to the financial company.

Looking at the changes, a company can visit the new financial company receiving the transfer once on behalf of the employees and apply for the transfer, enabling transfers between DB, DC, and corporate-type IRP. If the company already holds an account with the new financial company, it is also possible to visit the existing financial company once and apply for the transfer. However, if the company wishes to transfer only part of the DB account balance or split the transfer among multiple financial companies, this will only be possible through the existing financial company for the time being.

The required documents will also be significantly reduced. Previously, up to seven documents were needed, but going forward, the transfer procedure can be completed with only one or two documents.

The existing financial company from which the transfer is made must provide guidance on any potential disadvantages that may arise during the transfer via phone or other means and confirm the final intention to transfer. Companies wishing to transfer must reconfirm their intention to transfer with the existing financial company using their chosen method for the transfer application process to be completed.

There are also precautions. It is necessary to carefully check which financial company, existing or new, is more advantageous. This is because the rates of return, fee levels, variety of managed products, and services offered vary greatly by financial company. Rates of return and fee rates by retirement pension system can be checked on the Financial Supervisory Service’s Integrated Pension Portal.

Transfers between DB or between DC must be made to financial companies listed in the pension regulations. Furthermore, when transferring, if the currently managed products are sold, disadvantages such as the application of lower cancellation interest rates or redemption fees may occur.

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