Input 2021.02.14 13:34
In connection with the reduction of the legal maximum interest rate from 24% to 20% per year in July, loan products will be temporarily supplied to borrowers who received a loan exceeding 20% before the effective date. Incentives such as financing and business regulations are provided to excellent lenders for low-income loans.
On the 14th, the Financial Services Commission announced this year’s focus on the financial consumer sector’s focus on such content.
The Financial Services Commission decided to first introduce an ultra-long-term mortgage with a maturity of 40 years as a policy mortgage through computer development such as Korea Housing Finance Corporation (Jugeumgong). An official from the Financial Services Commission explained that “youth and newlyweds will be able to use mortgages up to 40 years.” Policy mortgages include stepping stone loans, bogeumjari loans, and qualified loans.
Regarding the timing of the introduction, he said, “In the business plan announced in January, we said that we will introduce a pilot in the second half, but we will try to introduce it as soon as possible without being restricted by this.”
In addition, the supply limit (4.1 trillion won) was abolished to provide sufficient supply to expand support for youth transfer and monthly household loans. We will also consider raising the per capita limit. The guarantee fee is also lowered from 0.05% to 0.02%. In addition, through diversification of housing pension supply and demand methods and reorganization of the trust business system, it was decided to revitalize financial products for the elderly in the aging era.
We support rapid resurgence to vulnerable debtors. In the case of closure or closure of business due to a novel coronavirus infection (Corona 19), regardless of business history, it is possible to apply for a special repayment postponement (up to two years) before debt adjustment amortization. The Credit Recovery Committee’s preliminary debt adjustment (interest rate adjustment) for individual debtors with a delinquency period of 31 to 89 days has also been improved in a way that helps the vulnerable.
◇ Follow-up measures are implemented following the annual reduction of the maximum interest rate by 24 → 20%
The burden of high interest rates on the common people is also reduced by following up on the legal maximum interest rate cut. In line with the maximum interest rate cut, we review the width of the Sunshine Loan 17 rate cut, and temporarily supply loan products with a loan exceeding 20%. A maximum of 20 million won will be provided to low-income and low-credit users who have been using high-interest rate loans in excess of 20% for more than one year before the effective date of the maximum interest rate cut, or whose maturity is imminent within six months and are repaying normally.
In addition, it diversifies policy-less financial products so that individual financial sectors can take the lead in designing and supplying policy-less products, rather than focusing on workers’ sunshine loans. This is a method in which the financial sector designs and presents the guarantee department’s low-income financial products, and the low-income financial promotion agency provides the guarantee after examination.
Incentives are also provided to financial companies with excellent low-income loans. It was decided to create a so-called’Loan Business Premier League’ that provides various incentives in terms of financing, business regulations, and sanctions for loan companies that do not violate the law and focus on low-credit loans. When the company launched in November last year has excellent performance in handling mid-interest rate loans, the deposit-to-deposit ratio for savings banks is preferred.
In line with the high interest rate cut, the government decided to strengthen the pan-government response to eradicate illegal private finance, and to make efforts to rescue victims and support self-support. Prosecutors, police officers, and special envoys conduct extensive Japanese crackdowns and deprive tax evasion gains through tax verification and investigation. In order to block illegal collection, it was decided to appoint a debtor attorney and expand and reinforce the support of lawyers for overpayment of the highest interest rate and returning interest.
The Financial Services Commission will also establish an efficient support system in line with the enforcement of the Financial Consumer Protection Act, which will take effect on the 25th of next month. The’Kumso Act Enforcement Preparation Situation Team’ is intensively operated for 3 months before and after the enforcement of the Act. For the soft landing of the new system, six months after the enforcement of the law, we will focus on supporting the settlement of the system, and then intensively check the status of compliance with the law.