Yoon Criticizes Kakao and Banks for "Immorality and Gapjil... Must Be Corrected"

KakaoT Commission "Predatory Pricing... Measures Must Be Taken"
Yoon "Small Business Loans Have Lower Default Rates Than Corporations... Must Push Strongly"

President Yoon Suk-yeol criticized Kakao, which provides taxi services, and commercial banks on the 1st for immorally abusing their monopolistic positions and engaging in power abuse, stating that this must be corrected.

President Yoon made these remarks during the 21st Emergency Economic and Livelihood Meeting held in the form of a Livelihood Town Hall at a cafe in Mapo-gu, Seoul, on the morning of the same day.

A taxi driver said, "The tyranny using Kakao Taxi's monopolistic position is too severe. I hope the excessive call commission fees can be drastically reduced to about 1%, similar to credit card payment fees," and added, "Last year, the Fair Trade Commission imposed fines for call bundling, but the issue has not been corrected. I request strong criminal penalties."

President Yoon pointed out, "This is also mentioned in the theory of monopoly and oligopoly. So-called predatory pricing means charging almost nothing or very low prices to eliminate competitors, then continuously attracting new entrants to completely dominate the market, and once monopoly is established, raising prices to profit."

He continued, "This was not a case of entering the market with a fixed price from the start, but rather luring everyone in and then raising prices, which is an immoral act," adding, "The government must impose sanctions."

President Yoon strongly instructed the cabinet members attending the event, saying, "I am someone who studied law. Legally, there is no problem at all," but added, "This is a very immoral act even among monopolistic behaviors, so we must definitely prepare measures to address this."

[Image source=Yonhap News]

He also sharply criticized the monopolistic behavior of banks regarding loan interest rates. A citizen running a small business lamented, "Loan interest rates suddenly rose, making things difficult," and "After developing a new product, I need to secure large quantities of raw materials and must take out a loan, but there are many regulations from banks."

President Yoon said, "Banks in advanced countries really provide excellent service to customers, guide them on various loan products, and actively promote which of their systems can be used for the business," adding, "Our country's banks engage in a lot of power abuse. The reason is the oligopolistic state of our banks, which is also a kind of monopoly."

He further stated, "Compared to corporate loans, household loans or small business loans have lower default rates and more stable loan receivables. They should not operate with this attitude and must change their nature," emphasizing, "The monopolistic behavior of banks must never be left unattended by the government. It must be strongly pushed back against."

A worker in their 30s also appealed, saying, "If 10% is not repaid when extending the Small and Medium Enterprise Youth Jeonse Loan (SME Youth Loan), an additional 0.1% interest rate is added," and "Regarding subscription (SME Youth Loan), interest rose by 0.3% to 1.5%, which is burdensome."

President Yoon responded, "Policy finance is when the government entrusts funds to banks to lend for necessary policy purposes. The government would not ask banks to return the money with interest to the treasury later, so why do banks raise these interest rates?" He added, "In my view, raising interest rates on policy finance products just because other rates have risen does not seem appropriate."

Kim Joo-hyun, Chairman of the Financial Services Commission, explained, "Banks have their own funding costs and bear some losses due to risks, so there are limits to how much they can lower interest rates," and said, "We will try to reflect this as much as possible when utilizing policy funds and supporting budgets so that the interest rates that actually reach ordinary people are kept as low as possible."

President Yoon instructed Chairman Kim, "If the Financial Services Commission or the Financial Supervisory Service raises interest rates on government policy funds, please thoroughly manage the aftereffects, such as 'how the interest is being charged' and 'why it is rising,'" adding, "Especially for policy funds going to small and medium enterprises, our ordinary citizens, and youth, please conduct thorough after-management to ensure that no unfair profits are made."

[Image source=Yonhap News]

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