IBK Industrial Bank of Korea Joins FSC's Credit Assessment System Reform

IBK Industrial Bank of Korea will participate in the pilot operation of the specialized credit assessment system for small business owners, a reform initiative led by the Financial Services Commission. This initiative aims to move away from the traditional default rate-based credit evaluation and introduce a new model that also reflects future growth potential, thereby expanding financial support for growth-oriented small businesses.

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On April 9th, IBK Industrial Bank of Korea announced its participation in the "Reform of the Credit Assessment System for the Introduction of the Specialized Credit Assessment Model (SCB) for Small Business Owners," a project organized by the Financial Services Commission. The SCB model is a jointly developed system by Korea Credit Information Services and NICE Information Service. It combines the existing default rate-based credit rating (CB) with a growth rating (S) that reflects the future growth potential of small businesses to calculate a final score. In particular, the growth rating leverages artificial intelligence (AI) to analyze quantitative data such as financial information to determine growth probability, while also incorporating qualitative factors like business operator competency and local commercial area characteristics, thus enhancing the precision of the evaluation.

Starting from the third quarter of this year, IBK Industrial Bank of Korea plans to implement a pilot program that applies the new model to the loan limits and interest rate calculations of its specialized products for small business owners, alongside its internal credit ratings. The bank intends to move beyond the previous evaluation methods that only considered delinquency or default risk and instead incorporate growth potential as well. IBK Industrial Bank of Korea expects that this pilot program will improve financial accessibility for small business owners who have growth potential but have not received sufficient evaluation under existing credit assessment frameworks. Jang Minyoung, President of IBK Industrial Bank of Korea, stated, "This credit assessment system reform will not only expand financial support but will also mark a policy turning point toward strengthening data-driven inclusive finance. We will continue to cooperate with the government to actively lead inclusive finance so that small business owners, the backbone of our economy, can regain their vitality."

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