Kabang's 'Fully Non-Face-to-Face Mobile Jeonse Deposit Loan' Cumulative Supply Exceeds 13 Trillion Won

General Jeonwolse Deposit Loans: 84% Borrowers Aged 30-40... Weekend and Holiday Loan Execution Rate 15%

[Asia Economy Reporter Yu Je-hoon] KakaoBank announced on the 18th that the supply amount of its fully non-face-to-face, mobile jeonse and monthly rent deposit loans, first launched among domestic banks in 2018, reached 13.5879 trillion KRW as of the end of last month. The loan balance also surpassed 10 trillion KRW.

In particular, KakaoBank added that the supply amount of youth jeonse and monthly rent deposit loans tripled within one year of launch, accounting for 60-70% of all youth jeonse and monthly rent deposit loans.

KakaoBank cited the reasons for this steep growth as the convenience of saving time and applying for loans via mobile, as well as attractive loan interest rates. KakaoBank’s jeonse and monthly rent deposit loans allow customers to check loan limits and interest rates before signing the lease contract, do not require submission of physical documents, and loans can be executed on weekends and holidays.

By category, general jeonse and monthly rent deposit loans have been executed for a total of 7.7836 trillion KRW over 51 months. The supply amount of youth jeonse and monthly rent loans, introduced in 2020, was 5.8043 trillion KRW, totaling 13.5879 trillion KRW.

By customer age group, 30s and 40s accounted for the largest share of general jeonse and monthly rent deposit loans at 84.3%, followed by 20s (9.9%) and 50s and above (5.5%). By time of day, 15% of customers executed loans outside of bank business hours, including weekends and holidays.

The weighted average interest rate for customers who received jeonse and monthly rent deposit loans from KakaoBank was 2.78%, which is 0.53 percentage points lower on average compared to other banks (based on HF Korea Housing Finance Corporation’s announced rates). Assuming a loan amount of 200 million KRW last month, customers could save about 1.06 million KRW annually in interest expenses.

KakaoBank also waives prepayment penalties. Over the past four years, KakaoBank waived fees on loan amounts totaling 1.9584 trillion KRW for customers who took out jeonse and monthly rent deposit loans, exempting approximately 6.8 billion KRW in fees. KakaoBank does not charge prepayment penalties on any loan products, including mortgage loans and personal loans.

A KakaoBank official said, "We have a broad lineup from jeonse and monthly rent deposit loans to mortgage loans to help form a housing ladder for real demanders such as youth and the homeless," adding, "We will continue to strive to provide practical support for housing issues based on more competitive interest rates and innovative convenience."

Meanwhile, KakaoBank’s general jeonse and monthly rent deposit loan product offers a maximum loan limit of 222 million KRW to customers aged 19 or older who are homeless or own one house jointly with their spouse, with interest rates starting at 2.89% as of the 18th. The youth jeonse and monthly rent deposit loan, jointly introduced by the Korea Housing Finance Corporation and commercial banks for homeless youth, offers up to 100 million KRW to youth aged 19 to 34, with a minimum interest rate of 2.60% as of the 18th.

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