"Why am I excluded when even foreigners can apply?" Youth Hope Savings controversy continues... Cheong petition included

[Image source=Yonhap News]

[Asia Economy Reporter Bu Aeri] Controversy continues as it has been revealed that foreigners can also subscribe to the Youth Hope Savings, which is receiving intense attention. Some voices are expressing dissatisfaction, claiming that the government prioritizes foreigners over its own citizens. However, financial authorities maintain that the operation method is the same as that of general tax-exempt savings products.

According to the financial sector on the 26th, foreigners who meet certain requirements can also subscribe to the Youth Hope Savings. Foreign young workers who have worked and paid taxes in Korea for a certain period are also included. This applies to those who have resided for more than 183 days and paid taxes.

Youth Hope Savings is a policy financial product introduced by the government to help young people build assets. Subscribers can freely deposit up to 500,000 KRW per month, and the maturity period is 2 years. With government incentives and tax-exempt benefits, an effective annual interest rate of 9-10% can be enjoyed. Eligible subscribers are those aged 19-34 with a total annual salary of 36 million KRW or less in the previous year. In fact, young people’s interest is high. As the number of applicants surged beyond initial expectations, the government changed its policy to allow all applicants to subscribe by the 4th of next month.

As Youth Hope Savings shows signs of overheating, various complaints about age limits and income requirements are emerging. In particular, there are grumblings about having to compete with foreigners. In worker communities, voices are calling for blocking foreigners and relaxing conditions for young people. Office worker Kim Sujeong said, "I gave up thinking it would go to others because I didn’t meet the income requirements, but honestly, I don’t understand giving benefits to foreigners."

A petition to the Blue House asking to block foreigners from subscribing has even appeared. The petitioner, who identified as a 34-year-old office worker, said, "I worked overtime every day and earned minimum wage," and added, "I think it’s great that wages are rising and youth are being supported, but should I have to give money to foreign young people with the taxes I paid?" The petition received agreement from over 4,000 people.

In addition, Youth Hope Savings sparked fairness controversies when social newcomers who were employed last year were denied subscription due to lack of income proof from the National Tax Service. Usually, the previous year’s income is finalized around July to August of the following year after year-end tax settlement and employer tax office reporting. Accordingly, banks only accepted subscriptions from those aged 19-34 with total annual salary of 36 million KRW or less in 2020, leading to many complaints. As the controversy continued, the government also began discussions. On the 23rd, Financial Services Commission Chairman Ko Seung-beom said to reporters, "We are consulting with relevant authorities to allow social newcomers who earned income for the first time last year to subscribe."

Some view that the controversy has continuously spread because the government initially failed to predict demand. A financial sector official said, "The problem seems to have been predicting demand for a product with an interest rate reaching 10% at around 380,000 people," adding, "As applications became fierce, complaints inevitably exploded."

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