From Next Month, Middle and High School Students Can Also Get Credit Cards... Up to 500,000 KRW per Month

Shinhan and Samsung Card Finalizing Product Checks
Family Card Format with Industry and Limit Restrictions

[Source=Yonhap News]

[Asia Economy Reporter Ki Ha-young] Starting next month, middle and high school students will be able to obtain credit cards issued under their own names. Given concerns about potential misuse of cards by minors, attention is focused on whether this will create a ripple effect in the market.

According to industry sources on the 18th, Shinhan and Samsung Card are in the final stages of preparing to launch credit cards for middle and high school students aged 12 and above next month. These cards will be available only in the form of family cards, where parents set usage categories and limits for their minor children (middle and high school students aged 12 or older). A family card is a card issued to spouses, parents, or children based on the primary cardholder’s credit criteria.

In January, the Financial Services Commission designated family card services for minor children as an innovative financial service and granted special exceptions. This aims to improve convenience in financial transactions and to reform the practice of transferring or lending credit cards. Normally, credit cards can only be issued to individuals who have reached the legal adult age (19 years old) under civil law. Since lending credit cards to family members is illegal, this legal framework of family cards creates an environment where youths can develop healthy spending habits.

The credit cards for middle and high school students have restrictions on usage categories and limits due to concerns about misuse by minors. Allowed usage categories include transportation, stationery, bookstores, convenience stores, and academies. The spending limit is generally capped at 100,000 KRW per month (50,000 KRW per transaction), but can be increased up to 500,000 KRW per month upon parental request. Also, as an innovative financial service, it will be operated on a limited basis during the two-year special exception period.

Issuance is non-face-to-face. To obtain a middle or high school student credit card, parents must submit a copy of their real-name verification document to the card company, complete identity verification via mobile phone or public certificate, and input the child’s information such as name, relationship, and mobile phone number. Once the application is received, the card company will issue the card after a phone call with the child.

Since last year, the financial sector has been releasing financial products targeting youths as future potential customers. Kakao Bank introduced a prepaid card that can only be opened by youths aged 14 to 18, and card companies have successively launched youth-only check cards with postpaid transportation card functions. An industry insider said, "Youth-targeted services currently have low usage and are not yet profitable markets. We are developing products for youths to gain a first-mover advantage as future potential customers."

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