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“If I borrow 100 million won, do I have to pay 10 million won each month?”
On the 19th, when the Financial Services Commission announced the introduction of the principal installment repayment system for credit loans, comments complaining about various portal sites followed. This is because the burden of principal and interest to be paid every month is exploding since the first month of the loan has to be paid off along with interest and principal.
The Financial Services Commission explained that it was aimed at reducing the risk of household debt by blocking the act of’debt investment’. An official from the Financial Services Commission said, “If the principal has to be divided and paid off, the demand for large credit loans could be reduced.”
Along with this, examples of changes in principal and interest of credit loans for five years were presented. If you received a credit loan of 100 million won with a maturity of 5 years at a 3% annual interest rate, you only need to pay 250,000 won per month and repay 100 million won after 5 years, but 1,79,6869 won per month (equal repayment of principal interest) It is the content that must be paid back.
However, the financial sector says that the five-year calculation method does not mean much in the real loan market. This is because credit loans are usually received annually. The account is maintained by renewing the contract again when the term expires after using a negative bankbook (limited loan) for one year.
An official from a commercial bank explained that “there are few cases where 5 year credit loans are issued at actual branches. Most of them make a one-year loan and then temporarily repay the principal or extend the contract.”
Assume that you received a credit loan of 100 million won with a maturity of one year at an annual interest rate of 3%. 8.85 million won, including the principal, must be repaid per month. If your credit rating is low and you receive a higher interest rate, you may have to pay off your loan at 10 million won per month.
An official from a commercial bank said, “If someone who can pay that amount of principal and interest, what would you take the loan for?” .
Some point out that end-users who receive loans that are not for real estate or stock investments can suffer from distress. Self-employed people often pay off their temporary needs with credit loans and repay them after a few months. For economic reasons, there are also a significant number of the low-income class who draw their living funds through credit loans.
If the new system is applied universally, they may give up loans or become bad credit because they cannot repay the principal and interest after loans in time. A policy to reduce household debt risk can increase the risk.
I am concerned that it may be too sudden to block debt. In order to reduce unnecessary confusion in the market, it will be necessary to hear more voices from the field.
Reporter Jeong So-ram [email protected]
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