Seungbeom Go "Debt Consolidation Loan Platform Will Not Be Bound by Reconsideration Deadline... Sufficient Consultation"(Comprehensive)

3rd Extension of Small Business Loan Maturity and Interest Payment Deferral to be Announced Before Chuseok
Private Meeting with Financial Supervisory Service Chief... "Financial Services Commission and FSS Must Act as One"

Financial Services Commission Chairman Ko Seung-beom, World Economy Research Institute Chairman Jeon Kwang-woo, Shinhan Financial Group Chairman Cho Yong-byoung, and other officials are attending the World Economy Research Institute-Shinhan Financial Group International Conference celebrating the 20th anniversary of Shinhan Financial Group at Lotte Hotel in Jung-gu, Seoul on the 2nd. Photo by Moon Ho-nam munonam@

[Asia Economy Reporter Kwangho Lee] The financial authorities' plan to launch a debt refinancing (loan switching) platform, targeted for October, is expected to be delayed. The decision on whether to extend the third phase of the maturity extension and interest repayment deferral measures for small business loans, which expire at the end of this month, is likely to be made before Chuseok.

On the 2nd, after attending the Shinhan Financial Group's 20th anniversary international conference held at Lotte Hotel in Sogong-dong, Jung-gu, Seoul, Financial Services Commission Chairman Ko Seung-beom told reporters, "The debt refinancing platform service is an issue that needs continuous review," adding, "We will not be bound by the reconsideration deadline and will take sufficient time to consult."

When asked if the biggest problem with the platform was the fees fintech and big tech companies would charge, he said, "We are looking at various issues."

Earlier, the FSC had planned to launch the debt refinancing platform service in October as announced in its work plan in February. However, the banking sector, recognizing that the service would be led by big tech companies requiring financial firms to pay separate fees, opposed the plan, causing a halt in progress.

Regarding calls for amendments to the Financial Company Governance Act following the first trial ruling to cancel the disciplinary action against Sohn Tae-seung, Chairman of Woori Financial Group, Ko said, "This is an issue to be reviewed going forward, and we will also reconsider institutional aspects in light of recent events."

On the issue of COVID-19-related maturity extensions and interest repayment deferrals for small business loans, Ko said, "We will review both together and announce a comprehensive plan before Chuseok." However, when asked whether the maturity extension and interest repayment deferral could be decided differently, he said, "Specific details will be reviewed."

In response to criticism that recent household loan regulations and small business loan maturity extensions are contradictory policies, he explained, "Overall liquidity has increased, so we need to respond accordingly. At the same time, with strengthened COVID-19 quarantine measures and difficult circumstances, I believe the hardships of small and medium-sized enterprises and self-employed individuals must be fully considered."

Chairman Ko also held a private meeting with Financial Supervisory Service Governor Jung Eun-bo on the same day.

Ko said, "As I mentioned before taking office, I believe the FSC and the FSS should operate as one body," adding, "In that regard, I intend to meet Governor Jung to strengthen communication and promote our work going forward."

Until now, the FSC and FSS have been at odds over various issues such as the KIKO dispute, Samsung Biologics accounting fraud, the revival of comprehensive inspections, and the independence of the FSS.

However, with the simultaneous replacement and appointment of the heads of both institutions, the tense relationship is likely to ease. Both Chairman Ko and Governor Jung are former economic officials and passed the 28th Administrative Examination together. Having worked closely for a long time, they are expected to build a cooperative relationship in handling tasks.

It is anticipated that the two leaders will first discuss household debt measures, considered the biggest current issue.

Chairman Ko has consistently emphasized the risks of household debt. In his inauguration speech on the 31st of last month, he stated, "We will use all means and focus policy capabilities to eliminate the risk factors embedded in the rapidly increasing household debt."

Governor Jung also pointed out the risks of household debt at his inauguration. He said, "There is a possibility of a 'perfect storm' where various risks such as the expansion of insolvency among marginal companies and self-employed individuals, and price adjustments of assets with bubble concerns, occur simultaneously," adding, "While financial support for real economic recovery is urgently needed, we face a challenging financial environment where excessive private sector debt must be managed."

Additionally, key agenda items are expected to include supervision of virtual asset exchanges and disciplinary actions against financial company CEOs related to private equity fund incidents.

A financial authority official said, "Since this is their first meeting after taking office, they are expected to discuss general financial issues."

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