Banking Sector's Contribution Rate to Community Finance Raised to 0.06%... Securing Additional Annual Funding of 98.6 Billion Won
Notice of Legislative Amendment to the Enforcement Decree of the
Support for Low-Income Financial Life Act
Effective from March 21, Next Year to October 2026
On the 13th, the Financial Services Commission announced the legislative notice for the amendment of the Enforcement Decree of the Act on Support for the Financial Life of Low-income and Vulnerable Groups. The core of the amendment is the increase in the common contribution rate of the banking sector and the establishment of a basis for the secondary interest subsidy project.
First, the common contribution rate of the banking sector will be raised by 0.025 percentage points from the current 0.035% to 0.06%. This follows the amendment to the Low-income Finance Act passed by the National Assembly last August and is scheduled to be applied from March 21, next year, until October 2026. The Financial Services Commission expects that this rate increase will secure an additional annual fund of 98.6 billion KRW.
Additionally, the amendment includes the secondary interest subsidy support work for stabilizing the financial life of low-income and vulnerable groups within the scope of the "Support Project for the Financial Life of Low-income People." Through this, the Korea Inclusive Finance Agency will have a legal basis to carry out projects that reduce the interest burden on users of policy low-income finance.
The Korea Inclusive Finance Agency's supply performance of policy low-income finance increased from 9.8 trillion KRW in 2022 to 10.6 trillion KRW in 2023, recording 6.7 trillion KRW by the third quarter of 2024. A Financial Services Commission official explained, "The need for financial support for low-income groups is increasing due to worsening economic conditions such as COVID-19, high interest rates, and high inflation."
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This amendment to the Enforcement Decree will undergo a 40-day legislative notice period from November 14 to December 24, followed by review by the Ministry of Government Legislation and approval by the State Council, and is scheduled to be enforced from March 21 next year.
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