New Hope Holssi Loans Supplied at 1.4 Trillion Won...Eased Income Criteria

The 'Saehui-mang Holssi', a loan product for low-income earners provided by banks, exceeded 1.4 trillion won in supply during the first half of this year.

According to the Financial Supervisory Service and the Korea Federation of Banks on the 19th, the supply performance of Saehui-mang Holssi by 14 banks excluding Industrial, Export-Import, Citi, K Bank, Kakao Bank, and Toss Bank reached 1.4233 trillion won, an increase of 16.5% (201.4 billion won) compared to the same period last year.

The Financial Supervisory Service stated that through continuous efforts to expand supply in the first half, the supply increased by 20.3% from 645.7 billion won in the first quarter to 776.6 billion won in the second quarter. The supply scale by bank was in the order of NongHyup (243 billion won), Kookmin (230.4 billion won), Hana (210.5 billion won), Shinhan (201.2 billion won), Industrial (150 billion won), and Woori (114.2 billion won).

The average interest rate in the first half was 7.8%, up 0.8 percentage points from the same period last year, but this was below 50% of the benchmark interest rate hike (1.75 percentage points) during the same period. The delinquency rate slightly increased to 1.6% from 1.4% in the same period last year.

Each bank revised its operational regulations in June this year to activate the supply of Saehui-mang Holssi by relaxing income requirements and expanding the youth preferential interest rate application from those aged 29 and under to those aged 34 and under. Saehui-mang Holssi loans are provided at an annual interest rate cap of 10.5% and up to 35 million won, determined autonomously by each bank, to individuals with an annual income of 50 million won or less who are in the bottom 20% of personal credit scores (previously credit grade 6) and those with an annual income of 40 million won or less regardless of credit rating.

The Financial Supervisory Service said, "In the second half, we will continue to expand supply by discovering new customers, promote interest rate reductions, launch specialized products, and strengthen support for low-income and low-credit borrowers who are facing difficulties."

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