Financial Services Commission Operates 'Maximum Interest Rate Reduction Implementation Task Force'... Focused on Market Stabilization Efforts

[Asia Economy Reporter Kwangho Lee] Financial authorities are forming and operating an 'Implementation Situation Team' to ensure the market stabilization of the maximum interest rate reduction (24% → 20%).

On the 16th, the Financial Services Commission held the first meeting of the 'Maximum Interest Rate Reduction Implementation Situation Team' with the Financial Supervisory Service, the Korea Inclusive Finance Agency, the Credit Counseling and Recovery Service, and related financial associations to review the progress of follow-up measures for the maximum interest rate reduction and plans for future market inspections and financial difficulty consultations.

The Implementation Situation Team is organized and operated with three teams: the Policy Inspection Team, the Market Inspection Team, and the Difficulty Consultation Team.

The Policy Inspection Team carries out institutional improvements such as legal amendments related to the implementation and follow-up measures of the maximum interest rate reduction and promotes key progress through field visits and press release distribution.

The Market Inspection Team focuses on monitoring market conditions and industry trends, including violations of the maximum interest rate after the reduction, and strengthens consultations and promotions to prevent the inflow of illegal private loans due to the interest rate reduction.

The Difficulty Consultation Team connects those in need of funds with policy-based inclusive finance and institutional finance through financial difficulty consultations and conducts promotions and education targeting consumers.

At the meeting, Secretary-General Kim Taehyun requested active roles from each institution to ensure the market stabilization of the maximum interest rate reduction.

He emphasized the smooth implementation of follow-up measures announced in three phases (improvement plans for the policy-based inclusive finance supply system, loan business improvement plans, and mid-interest loan improvement plans).

Secretary-General Kim also requested the Financial Supervisory Service to closely monitor market trends and strictly respond to attempts by financial companies to circumvent or violate the maximum interest rate regulations. He urged thorough prevention and response efforts, as illegal private lenders might expand their operations taking advantage of this opportunity.

Furthermore, he asked the associations of each industry sector to review measures to provide related benefits to existing loan users as well. Similar to the 2018 maximum interest rate reduction case, he requested the associations to gather opinions from member companies on whether there is an incentive for financial companies to voluntarily participate in maintaining and securing diligent repayment customers by applying the reduced maximum interest rate to customers who meet certain criteria, such as those without delinquency records.

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