Woori Bank Extends Principal Repayment Program for Vulnerable Groups by 1 Year... "Practicing Win-Win Finance"

Automatic Repayment of Interest Amount Exceeding 6% per Annum for Diligent Borrowers

Woori Bank announced on the 2nd that it will extend the ‘Financial Vulnerable Group Support System,’ which reduces the loan principal for financially vulnerable groups who have diligently paid interest, for one more year as part of its win-win finance initiative.

The Financial Vulnerable Group Principal Repayment Support System is designed to help low-credit and high-risk multiple debtors (those with a KCB rating of 6 or below, a DTI of 80% or higher, and who have loans from three or more financial institutions) maintain independence when extending personal credit loans with interest rates exceeding 6% per annum. Woori Bank was the first in the financial sector to implement this system in 2019.

To prevent moral hazard, the system automatically repays the loan principal by the amount of interest exceeding 6% of the agreed interest rate for borrowers who have faithfully paid their loan interest. For example, if a qualified customer borrows 10 million KRW at an annual interest rate of 10%, 4% equivalent to 400,000 KRW will be repaid toward the principal. Early repayment penalties are waived in case of early settlement. Through this system, Woori Bank has supported principal repayments on loans totaling 39.6 billion KRW over the past year.

A Woori Bank official stated, “We have supported low-credit customers who have diligently managed their loans over the past four years, and we will continue to practice win-win finance that benefits vulnerable groups.”

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