Kakao Bank Surpasses 4.7 Trillion KRW in Credit Loan Balances for Medium and Low Credit Borrowers

KakaoBank announced on the 22nd that the average balance of credit loans (personal and individual business owner) for middle- and low-credit borrowers surpassed 4.7 trillion KRW in the third quarter.

In the first nine months up to the third quarter of this year, KakaoBank supplied middle- and low-credit loans amounting to 1.8 trillion KRW. Since its launch in July 2017, the cumulative total has reached 13 trillion KRW. The proportion of middle- and low-credit loan balances in the third quarter recorded 32.3%, exceeding the target of 30%.

While maintaining a household loan management policy, KakaoBank explained that this is the result of efforts to promote inclusive finance to improve financial accessibility for middle- and low-credit borrowers who are in the "interest rate blind spot." In the third quarter, KakaoBank accounted for more than half of the personal middle- and low-credit loans supplied by all internet-only banks.

KakaoBank, which was the only internet-only bank last year to achieve its middle- and low-credit loan target, plans to continue steady efforts to reach the previously announced 2024 middle- and low-credit loan supply plan (average balance over 30%, year-end balance of 4.8193 trillion KRW in 2024).

This month, KakaoBank has continued to support funding for financially marginalized groups by offering credit loan products for middle- and low-credit customers at a special minimum interest rate of 3% and providing interest support benefits for the first month.

Despite the active supply of middle- and low-credit loans and the continuous increase in balances, KakaoBank’s soundness indicators remain stable. In the third quarter of 2024, KakaoBank’s total loan delinquency rate improved by 0.01 percentage points year-on-year to 0.48%.

KakaoBank plans to enhance soundness management through the advancement of credit evaluation models using middle- and low-credit data and proactive reserve accumulation.

A KakaoBank official said, "We are constantly striving to ensure that vulnerable groups with middle- and low-credit, who have become more difficult due to the economic downturn, are not excluded from the financial sector," adding, "We will continue to lead the practice of inclusive finance based on competitive interest rates and convenience."

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