Under the Loan Business Act, the government decided to change the legal name of illegal loan companies to’illegal financial business operators’ instead of’unregistered lenders’ and lower the limit of interest rates they can receive from 24% per year to 6%. This is in accordance with the commercial court interest rate, which is the interest rate allowed in commercial law transactions. Until now, illegal private finance companies, like registered lenders, can earn interest up to the legal maximum rate of 24% per year.
If the revised bill is implemented after a state council meeting, no matter how high interest rate loan contracts are signed by illegal private financiers, the share of over 6% per year will be invalidated.
In addition, increased reloans, in which the principal plus overdue interest is loaned again and a contract is written, are also prohibited. Increasing reloans borrowed 1 million won at an annual interest rate of 30%, but if they could not be paid back, they would reloan 1.3 million won and apply 30% interest, causing a snowball-like burden.
Weekly event schedule
29th (Tue)
09:00 Executive meeting (Director of Financial Supervisory Service)
10:00 State Council Meeting (Finance Chairperson)
14;00 Inclusive Finance Meeting (Vice Chairman of the Financial Services Commission)
31st (Thursday)
10:30 Vice Minister’s Meeting (Vice Chairman of the Financial Services Commission)
Weekly press plan
27th(Sun)
12:00 Examination of professional private equity managers and inspection of private equity funds
12:00 Overseas direct purchase, from now on, use a credit card company’s virtual card issuance service to be safe!
From 12:00 January 1st, check your credit with your credit score
28th (Mon)
When distributed, the Financial Supervisory Service awarded the Inclusive Finance Award “Thank you with flowers”
12:00 “Watch out for companies disguised as financial investment companies that offer high returns through social media chat rooms!”
12:00 2020 regular credit risk assessment results and future plans
12:00 1H 2020 (April-September) Full-time investment advisory business performance
29th (Tue)
06:00 Status of issuance of derivative-linked securities issued by securities companies in the third quarter
10:00 Passed the State Council for amendment to the Capital Market Act
10:00 Passed the amendment bill of the 「Loan Business Act」
12:00 A summary example of K-IFRS inquiries to support corporate accounting processing capabilities
12:00 ’20 Financial Consumer Protection Status Assessment
14:00 Inclusive finance conference held
30 days (Wed)
06:00 Direct financing performance of companies in November of ’20
12:00 Financial system that will change from the New Year 2021
12:00 Notice on accounting for 2020 settlement
12:00 Survey on loan business in the first half of ’20
31st (Thursday)
06:00 Current status of insurance company RBC ratio as of the end of February 20.9
3rd (Sun)
12:00 Legislative notice of amendment to the Enforcement Decree of the Specialized Credit Finance Business Act