Financial Authorities Consider Setting Saemaeul Geumgo's Net Household Loan Growth at 'Zero' This Year...Effectively Banning New Loans

Impact of Exceeding Last Year's Target by Fourfold
If Existing Loans Are Not Reduced, New Lending Will Be Difficult

Financial authorities are considering measures to effectively prevent Saemaeul Geumgo from increasing household loans this year, after the institution far exceeded its household loan growth target last year.

Seoul Gangnam-gu Saemaeul Geumgo Central Headquarters. Photo by Jo Yongjun

According to the Financial Services Commission on March 8, the commission is currently discussing ways to limit the net increase in household loans by Saemaeul Geumgo this year. There is a possibility that the household debt management plan, which may be announced as early as the end of this month, will include setting Saemaeul Geumgo's household loan growth target at "zero."

This discussion stems from the fact that Saemaeul Geumgo's household loan growth last year significantly surpassed the target. In 2025, Saemaeul Geumgo increased its household loans by 5.31 trillion won compared to the previous year, about four times the original target.

Since introducing the total household loan cap, the government has assigned annual household loan growth limits to banks and other financial companies each year. Financial institutions that exceed their targets are penalized by having the excess amount deducted from their lending capacity for the following year. As a result, if Saemaeul Geumgo does not reduce its existing loan balance, it may find it virtually impossible to issue new household loans this year.

However, household loans at Saemaeul Geumgo have continued to rise even this year. In January alone, the balance increased by 800 billion won, and it reportedly grew by about another 800 billion won in February.

Given that financial authorities have been tightening controls on household lending this year to stabilize the real estate market, it appears likely that the regulatory pressure on Saemaeul Geumgo's lending will also intensify.

Analysts point to structural factors behind the increase in Saemaeul Geumgo's household loans. Saemaeul Geumgo consists of more than 1,200 independent entities, making centralized control by the headquarters challenging. In addition, with delinquency rates on the rise, there may have been an incentive to increase the loan balance to lower the overall delinquency rate.

Both within and outside of financial authorities, there are calls to strengthen the management and supervisory framework for Saemaeul Geumgo. Currently, supervisory authority over Saemaeul Geumgo rests with the Ministry of the Interior and Safety, but there are suggestions that this should be transferred to the financial authorities.

Saemaeul Geumgo, for its part, states that it is scaling back lending operations. The institution explained that it had already suspended household lending through its agents, and as of February 19, also halted group lending.

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