Card Loan Interest Rate Slightly Raised... Samsung Card Up by 1.29 Percentage Points

[Asia Economy Reporter Oh Hyung-gil] Credit card companies slightly raised the interest rates on card loans (long-term card loans) last month. As banks recently tightened lending standards, causing loan demand to shift to the "secondary financial sector," a balloon effect has emerged, leading card companies to raise interest rates to curb lending.

According to the disclosure by the Credit Finance Association on the 31st, as of the end of July, the average interest rates for card loans based on standard grades at seven major credit card companies (Shinhan, Samsung, KB Kookmin, Hyundai, Lotte, Hana, and Woori Card) ranged from 12.66% to 13.96%. The average card loan interest rate of these seven companies was 13.1%, up 0.15 percentage points from 12.95% in the previous month.

The average interest rates by card company were as follows: Hyundai Card 12.66%, KB Kookmin Card 12.78%, Shinhan Card 12.80%, Hana Card 12.88%, Woori Card 13.24%, Lotte Card 13.35%, and Samsung Card 13.96%, in ascending order.

Samsung Card raised its rate by 1.29 percentage points compared to the previous month, and Woori Card increased by 0.79 percentage points. Meanwhile, the average card loan interest rates of the other five card companies slightly decreased compared to the previous month.

Looking at the card loan interest rates by credit score disclosed by the seven credit card companies, the average interest rates for high-credit borrowers with credit grades 1 to 2 at Shinhan, Samsung, Hyundai, Hana, and Woori Card slightly increased compared to the previous month.

The rates were recorded as follows: Shinhan Card 10.11%, Samsung Card 10.38%, Hyundai Card 9.46%, Hana Card 11.32%, and Woori Card 8.68%. For KB Kookmin Card and Lotte Card, the average interest rates for high-credit borrowers with grades 1 to 2 slightly decreased compared to the previous month, recording 9.43% and 10.63%, respectively.

Recently, as financial authorities have strengthened loan regulations on banks, a balloon effect has occurred with loan demand shifting to the secondary financial sector.

According to the Financial Supervisory Service's Financial Statistics Information System, the card loan balance of the seven major credit card companies (Shinhan, Samsung, KB Kookmin, Hyundai, Lotte, Woori, and Hana Card) in the first quarter of this year was 33.1788 trillion KRW, an increase of 9.5% (2.874 trillion KRW) compared to the same period last year.

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