Banking Sector, Actively Consider Waiving Early Repayment Fees

Next Week's Party-Government Meeting on 'Substantial Real Interest Rate Burden Relief'

[Image source=Yonhap News]

[Asia Economy Reporter Lee Ji-eun] As the Bank of Korea recently raised the base interest rate to 3.25%, the ruling party has requested the banking sector to actively consider waiving prepayment penalties in light of the financial situations of low-income households.

On the 2nd, Seong Il-jong, the Policy Committee Chair of the People Power Party, said at the party's floor strategy meeting, "Prepayment penalties should be waived like the government’s Safe Conversion Loan program."

He pointed out that while people want to refinance their loans to reduce interest payments amid the high-interest rate trend, they are reluctant to switch loans due to the prepayment penalties they must pay.

He added, "Banks are making unprecedented profits due to high interest rates. It is time for the banking sector to respond to low-income people who are trying to save every penny," urging, "I hope the banking sector will actively waive prepayment penalties so that financially vulnerable groups can overcome the current crisis."

He also expressed the intention to hold a ruling party-government meeting next week regarding high interest rates to find ways to alleviate the public’s interest burden. Policy Chair Seong said, "Together with the government, we will carefully check the current realistic interest burden faced by the people, prepare practical measures to ease interest rates, and seek alternatives through next week’s ruling party-government meeting to support the public."

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