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There is growing concern in the industry about the government’s’Sunshine Loan Card’, which will provide a maximum payment limit of 2 million won to people who have not been issued a credit card due to low creditworthiness. If you issue a credit card to a low-credit person who is likely to be overdue and give various card benefits, loss is inevitable.
The Sunshine Loan Card is scheduled to be released in the second half of the year, according to the’policy small-scale financial supply system reform plan’ prepared by the Financial Services Commission on the 4th. The Sunshine Loan Card is a policy financial product designed by the Financial Services Commission to provide card use benefits to’low credit users (with a credit score of 680 or less, about 3.2 million people) who do not meet the standards for issuing credit cards. Those with the lowest 10% of these credit ratings can apply for a Sunshine Loan card if they take credit management training for more than 3 hours. The maximum credit payment limit is 2 million won per month.
The Financial Services Commission decided to differentiate the guarantee limit according to Sunshine Loan card payments by developing an index of repayment taking into account the repayment history and financial education and credit management consulting. Credit card companies plan to set individual credit settlement limits according to the guarantee limit set by the Financial Services Commission.
The guarantee funding was decided to be raised in the amount of 40 billion won from the low-income financial fund raised by contributions from banks, insurance, cards, savings banks, and mutual finance industries. The Sunshine Loan Card also includes additional service benefits. When using 300,000 won, it is a benefit of up to 10,000 won billing discount and no interest installment. The FSC and the industry are negotiating specific levels of benefits.
The card industry is concerned about the possibility that the delinquency rate will be higher than originally expected. According to Nice Evaluation Information, among those with a credit score of less than 600 in 2019, 1,566,029 people who do not own a credit card. The subrogation rate of’Worker Sunshine Loan’, whose credit rating is 6th grade or lower, exceeds 10%. If a card is issued to a low-credit person with less than 600 points who do not own a credit card, the amount of arrears can grow uncontrollably, and the burden of the card industry can be returned.
The Financial Services Commission is persuading credit card companies with the intention that’if the number of customers increases, you can earn more commissions’, but the reaction is not convincing in the industry. An official at the card company pointed out, “We are already seeing a deficit in small franchise fees,” and pointed out that “if existing card benefits are given to low-credit users and the number of delinquents increases, the more the number of customers increases, the more it suffers.”
Reporter Park Jin-woo [email protected]
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