Soaring Prices Spark 'Jjantech' Craze... Young Generation Collecting 'Tikkeul' Instead of 'YOLO'

26-Week Savings & Challenge Box... Small Savings Products Popular
Experts Say "Jjantech Craze Will Continue"

Photo by Getty Images Bank.

[Asia Economy Reporter Heo Midam] As the economic recession continues due to the COVID-19 pandemic, 'Jjantech' is gaining attention, especially among young people. 'Jjantech' is a compound word combining 'jjada,' meaning stingy, and 'jaetech,' referring to financial investment, and it means saving and investing small amounts of money. A few years ago, young people focused on spending for happiness, shouting slogans like 'YOLO' (You Only Live Once), but recently, economic uncertainty has increased, leading them to turn their attention to Jjantech.

As the number of 'Jjantech-jok' (Jjantech practitioners) who try to steadily save small amounts increases, small installment savings products are becoming popular in the financial sector. A representative Jjantech product is Kakao Bank's '26-Week Savings.' This savings product allows you to choose a weekly deposit amount from 1,000 won, 2,000 won, 3,000 won, 5,000 won, or 10,000 won and increases the deposit by that amount each week.

For example, if you choose 1,000 won as the first amount, you pay 2,000 won in the second week, 3,000 won in the third week, and 26,000 won in the 26th and final week. The 26-Week Savings was so popular that it recorded 11 million cumulative opened accounts as of the end of December last year.

Also, K Bank's automatic lump-sum savings product, 'Challenge Box,' is attracting attention. This product automatically calculates and transfers the amount you need to save weekly when you set your personal goal, target amount (within 5 million won), and target period (30 to 100 days). The basic interest rate is 1.5% per annum, and if you maintain the target amount until the goal date without complicated conditions, an increased preferential interest rate of 1.0% per annum is applied, allowing you to receive up to 2.5% annual interest.

In particular, the Challenge Box has a higher subscription rate among people in their 20s and 30s compared to other age groups. According to K Bank's analysis of Challenge Box account customers announced last March, 62% of all subscribers were in their 20s and 30s.

Photo by Asia Economy DB.

The reason young people are interested in Jjantech seems to be related to increased economic uncertainty. Especially recently, due to the simultaneous rise in prices, interest rates, and exchange rates?the so-called 'three highs (3go) phenomenon'?there are analyses that economic uncertainty will increase further in the second half of this year.

On the 1st, Hyundai Research Institute pointed out in its '2022 Second Half Economic Issues' report, "Due to rising raw material prices, inflationary pressure is increasing, and the Bank of Korea is hinting at additional base rate hikes. Meanwhile, the U.S.'s high-intensity monetary tightening policy has caused a high exchange rate (weak won), resulting in a triple burden."

It added, "As the 3go phenomenon continues, the possibility of falling into stagflation (rising prices amid economic slowdown) or slowflation (high inflation amid low growth) is increasing, so economic uncertainty is expected to expand in the second half."

Experts predict that the Jjantech craze will continue, especially among young people. Professor Lee Eunhee of Inha University's Department of Consumer Studies said, "As the COVID-19 pandemic prolonged, prices rose and the job market froze further. Also, when 'YOLO' was popular a few years ago, real estate prices were not as high as they are now. Ultimately, young people have chosen Jjantech to prepare for the future. This trend is expected to continue."

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