Financial Authorities "No Increase in Loan Limits"... Toss Bank Halts Additional Loans (Comprehensive)

Full Service Launch from the 18th

The third internet bank, Toss Bank, scheduled to launch on the 5th, is drawing attention from the banking sector. It has announced the release of groundbreaking interest rate products even before its launch, including the highest deposit interest rate in the banking sector at 2% per annum and a minimum loan interest rate in the high 2% range per annum, causing tension not only among other internet banks but also among commercial banks. Especially as financial authorities tighten regulations on household loans, leading to rising loan interest rates and restrictions on loan limits, Toss Bank's announcement of unsecured loans with a maximum limit of 270 million won is expected to attract demand from so-called "loan refugees." The photo shows the Toss Bank headquarters in Gangnam-gu, Seoul, on the 4th. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Kiho Sung] It has been reported that financial authorities have expressed a refusal policy regarding Toss Bank, an internet-only bank's request to increase its loan limit. Accordingly, Toss Bank will suspend the sale of new products in its existing loan services.

According to the financial sector on the 14th, financial authorities reportedly stated that increasing Toss Bank's loan limit is not possible. Previously, Toss Bank had requested to raise the household loan limit from 500 billion KRW to about 800 billion KRW, an increase of approximately 300 billion KRW. Since its launch on the 5th, Toss Bank has rapidly approached this year's total loan volume (500 billion KRW) within a few days, raising concerns about a loan suspension situation.

Following the authorities' policy, Toss Bank will suspend the sale of new products in its existing loan services until the end of this year in accordance with the government's household debt stabilization policy. This includes credit loans, overdraft accounts, as well as policy finance products such as Saetdol loans and emergency loans.

Currently, Toss Bank, along with other financial companies, is subject to the financial authorities' total loan volume regulations. The authorities have recommended that loans be limited to 500 billion KRW by the end of the year. This includes loans to medium- and low-credit borrowers.

Additionally, Toss Bank will provide services to all 1.7 million customers who pre-registered. Accordingly, starting Monday the 18th, all customers will be able to use Toss Bank regardless of whether they pre-registered.

So far, 550,000 applicants have been able to use Toss Bank. However, from 12 PM today, the service will be fully opened to 1.15 million waiting customers, and from the 18th, all customers are expected to be able to use Toss Bank.

In particular, the '2% annual interest rate' Toss Bank account, as well as check card products without monthly performance conditions, will continue to be offered with the same benefits. However, the sale of new products in existing loan services will be suspended until the end of this year in accordance with the government's household debt stabilization policy. This includes credit loans, overdraft accounts, as well as policy finance products such as Saetdol loans and emergency loans.

A Toss Bank official said, "This is a decision made in compliance with the government's household debt stabilization policy and considering the market situation," adding, "Despite various business constraints, we decided to open to customers after considering what value customers want the most."

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