"Promised to Help Ordinary People"… Unresolved Issues with Haetsalron Card and Haetsalron Bank

Assemblyman Kim Hee-gon "Need to Increase Contributions and Supply of Microfinance"
Urges Active Role of 5 Major Banks

Eun Sung-soo, Chairman of the Financial Services Commission, along with heads of major commercial banks, attended the 'Hetsal Loan Bank Business Agreement and Meeting' held on the 1st at the Seoul Jung-gu Community Finance Promotion Agency. They are taking a photo after completing the business agreement. Photo by Kang Jin-hyung aymsdream@

The supply performance of representative microfinance products, Haetsalron Card and Haetsalron Bank, has been found to be low. On the 1st, Kim Hee-gon, a member of the National Assembly's Political Affairs Committee, revealed the supply performance of each card company and bank along with the Worker Haetsalron, urging the role of the five major banks.

According to data submitted by the Microfinance Promotion Agency to Assemblyman Kim, Haetsalron Bank, which had a supply target of 1.4 trillion KRW last year, achieved only 88% (1.2361 trillion KRW) of the target. Haetsalron Card, with a supply target of 100 billion KRW, achieved only 27% (27.2 billion KRW), showing poor performance.

As of July this year, Haetsalron Bank supplied 72% (869.8 billion KRW) against the 1.2 trillion KRW supply target, and Haetsalron Card supplied 31% (15.3 billion KRW) against the 50 billion KRW target. Both products were launched in the second half of 2021. Unlike other products such as Worker Haetsalron and Haetsalron15, they still have not met their supply targets.

Haetsalron Bank is a product that provides loans up to 25 million KRW for up to 3 or 5 years to low-credit and low-income individuals who have improved their debt or credit rating as policy microfinance good repayment borrowers. Haetsalron Card supports the issuance of credit cards to low-credit individuals who have difficulty obtaining credit cards, issued to those with an annual disposable income of 6 million KRW or more and credit scores in the bottom 20%. It guarantees up to 2 million KRW per month for those with a KCB score of 700 or below and a NICE score of 749 or below.

Looking at the supply performance of Haetsalron Card by card company, as of last year, the number of issued cards exceeded 20,000, with a total supply of 27.18 billion KRW. Samsung Card accounted for the largest share with 7.72 billion KRW (28.4%), followed by Hyundai Card with 5.93 billion KRW (21.8%), and Shinhan Card with 4.27 billion KRW (15.7%). As of the end of July this year, 9,922 cards were issued, supplying 15.36 billion KRW. The subrogation repayment rate of Haetsalron Card as of the end of July this year reached 10.3%.

Regarding Haetsalron Bank's supply performance by bank, as of last year, the number of supply cases was 90,493, with a total supply of 1.2361 trillion KRW. Jeonbuk Bank accounted for the largest share with 1.1687 trillion KRW (94.5%), followed by Gwangju Bank with 24.5 billion KRW (2.0%), and Daegu Bank with 16.7 billion KRW (1.4%).

On the other hand, the supply from the five major commercial banks?Kookmin Bank (4.8 billion KRW, 0.4%), Shinhan Bank (4.8 billion KRW, 0.4%), Hana Bank (3.8 billion KRW, 0.3%), Woori Bank (1.8 billion KRW, 0.1%), and Nonghyup Bank (4.9 billion KRW, 0.4%)?was extremely low.

Assemblyman Kim said, “At a time when the delinquency rate of low-credit and low-income vulnerable borrowers is increasing, the role of microfinance is more important,” and added, “The five major banks should take a more active role in contributing microfinance funds and expanding supply.”

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