Military Mutual Aid Association-Shinhan Bank, Business Agreement for Launching Lump-Sum Deposit Loan

[Asia Economy Reporter Park Soyeon] The Military Mutual Aid Association and Shinhan Bank signed a business agreement on the 11th at the Military Mutual Aid Association’s main conference room to launch a lump-sum entrusted loan product for members of the Military Mutual Aid Association and agreed to proceed with product and system development.

The Military Mutual Aid Association operates a "Lump-Sum Entrusted Savings" program that grows members’ lump sums at more favorable interest rates than regular bank time deposits, with maturities of 6 months, 1 year, and 2 years. The newly launched product is a system that lends members up to 90% of the principal of their Lump-Sum Entrusted Savings.

Referring to the existing member loan product that allows borrowing up to 90% of the principal and interest of members’ retirement benefits currently operated by the Military Mutual Aid Association, discussions with Shinhan Bank have been ongoing since February two years ago to apply this to Lump-Sum Entrusted Savings as well. Through this agreement, Shinhan Bank will handle system development, loan screening, and loan execution tasks.

Jin Ok-dong, President of Shinhan Bank, introduced the Lump-Sum Entrusted Loan as "a product uniquely designed by the Military Mutual Aid Association for the convenient fund management of its members," and added, "We are very pleased to launch a new and special financial product for members together with the Military Mutual Aid Association, and Shinhan Bank will continue to make every effort to provide differentiated benefits to our members."

Kim Yu-geun, Chairman of the Military Mutual Aid Association, stated, "The Lump-Sum Entrusted Loan was promoted as part of efforts to develop various welfare systems and enhance member welfare," and added, "We ask for active cooperation and support so that the Military Mutual Aid Association can create synergy and contribute to member welfare by partnering with Shinhan Bank, which has outstanding expertise in the financial sector."

Meanwhile, the Lump-Sum Entrusted Loan was planned as part of member welfare with the intention of encouraging members to maintain their Lump-Sum Entrusted Savings until maturity and receive maturity interest benefits by offering low-interest loans, inspired by the fact that about 530 billion KRW out of the annual 2.7 trillion KRW Lump-Sum Entrusted Savings deposits are prematurely terminated. The Lump-Sum Entrusted Loan is scheduled to be launched in July this year after procedures such as system development.

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