"Disclose Loan Interest Cost"…Rep. No Woong-rae Proposes Amendment to Banking Act

"Provision of Interest Rate Calculation Method and Basis to Users Required"

[Image source=Yonhap News]

[Asia Economy Reporter Minwoo Lee] A bill to disclose the cost of loan interest rates has been proposed.

On the 17th, Roh Woong-rae, a member of the Democratic Party of Korea, announced that he had taken the lead in proposing a partial amendment to the 「Banking Act」 that requires banks to provide and explain to users the method and basis for calculating interest rates.

If this amendment is passed, banks must provide and explain important information or materials such as collateral and income, which serve as the basis for calculating interest rates, including the calculation method, to users when signing loan contracts. Representatives Ko Young-in, Kim Byung-gi, Kim Young-jin, Kim Jung-ho, Yang Jung-sook, Yoon Joon-byung, Lee Byung-hoon, Lee Yong-woo, Jeon Yong-gi, Jung Sung-ho, and Choi Ki-sang from the same party also co-sponsored the bill.

Representative Roh explained the purpose of the proposal, saying, "According to the current Banking Act, while banks are required to provide important information in financial transactions, the specific details have all been delegated to presidential decrees without examples." He added, "Due to this limitation, there have been issues raised that banks, holding a superior position over users in terms of information possession, have been exploiting excessive profits by adjusting additional and preferential interest rates."

Representative Roh continued, "We must not overlook the interest rate manipulations by banks that ignore the difficult realities faced by self-employed people and ordinary citizens," emphasizing, "We must prioritize the goal of stabilizing people's livelihoods and resolve household debt concerns caused by interest rate hikes."

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