One-Stop Support System for Illegal Private Lending Takes Hold... 537 Cases of Debt Collection Stopped

131 Victims Supported Within 5 Weeks of Operation
103 People Reported 820 Cases of Damage
537 Cases of Illegal Debt Collection Halted
156 Cases Resulted in Debt Settlement

The 'one-stop comprehensive and dedicated support system'—which blocks illegal private lending damage with a single report and links victims to relief measures—is showing tangible results from its early stages of implementation. Within just five weeks of operation, 131 victims have been supported and over 500 cases of illegal debt collection have been stopped, demonstrating the system's effectiveness in responding on the ground.

On March 31, the Financial Services Commission held a meeting with the National Police Agency, Financial Supervisory Service, Credit Counseling and Recovery Service, and Korea Legal Aid Corporation to review the operation status and areas for improvement of the illegal private lending one-stop support system, which has been in operation since March 9.

During approximately five weeks since the system went live, a total of 131 people received counseling, and among them, 103 individuals reported 820 cases of illegal private lending damage. Seventeen dedicated staff members, deployed across eight regions nationwide, provided close support throughout the entire process—from counseling and report preparation to appointing debtor representatives and referring cases to investigative agencies.

In particular, immediate action by the dedicated staff resulted in demands for illegal lenders to cease debt collection and settle debts, leading to the suspension of 537 cases of illegal debt collection. Of these, 156 cases resulted in actual debt settlements. The intervention of public institutions alone is seen as having significantly curbed illegal activities.

Investigations and blocking measures by financial authorities have also been carried out in parallel. The Financial Supervisory Service referred 17 cases to the police for investigation and requested financial companies to verify 21 accounts suspected of being used for illegal private lending. Many of these accounts had withdrawals and deposits suspended, effectively preventing further spread of damages.

The effectiveness of the system has also been confirmed through real-world cases. For victims who had borrowed tens of millions of won at high interest rates from multiple illegal lenders, intervention by dedicated staff led some creditors to stop collection or express their intention to give up the claims, showing immediate changes. In other cases, where debt had ballooned through repeated borrowing to pay off previous loans, procedures for invalidating loan contracts and appointing debtor representatives were initiated to provide relief.

The government evaluated improved accessibility due to the deployment of dedicated staff and the establishment of inter-agency cooperation systems as key achievements. It explained that the system enabling blocking debt collection, linking to investigations, and adjusting debt after a report is filed is working stably in practice. However, some areas for improvement were also identified. In certain cases, some victims did not take follow-up actions such as making additional reports or blocking accounts after collection was stopped. The need for closer cooperation with the police and the establishment of a response system for illegal debt collection based on overseas social media platforms was also raised.

Looking at actual types of damage, illegal private lending based online is rapidly spreading. Eighty-six percent of victims accessed illegal loans through social media or internet advertisements, and the share of those suffering from interest rates exceeding the legal maximum was highest at 65%. The Financial Services Commission plans to continuously monitor the operation of the system and strengthen outreach to improve victim accessibility. In addition, it aims to push for legal amendments to provide grounds for blocking fraudulent accounts and social media accounts and to introduce the right to request information, thereby strengthening the response to online-based illegal private lending.

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