소액 생계비대출#. Ms. Kim (34), who is raising her children, was at a loss after the contract period for her home, where she had been living on unsecured rent for the past year, ended. This is because she was informed by her landlord that ‘she can now live on monthly rent only if she pays a deposit.’ Kim, who was desperate for money, borrowed 1 million won as a daily loan from an illegal private loan company that required repayment over 65 days at 20,000 won per day. Last week, Ms. Kim visited the Microfinance Integration Support Center to apply for a small loan for her living expenses, and through consultation, reported the daily loan company to the Financial Supervisory Service as a case of illegal private lending.
#. Mr. Lee (27), who is preparing for the civil service exam, applied for a loan of 1 million won for ‘small living expenses’ to finance his studies. Ms. Lee lives in a single-parent household, her mother is physically disabled, and she herself is a job seeker and has no monthly income, so she used credit card cash advances and revolving to cover her living expenses. She was increasingly struggling with the high interest rates, had already incurred delinquency, and had no money to pay for online lectures, so she applied for a small living expenses loan with proof of study expenses and at the same time was informed of the Credit Recovery Committee’s debt adjustment system.
These are some of the cases in which consultation was conducted among 6,250 reservations for small living expenses loans disclosed by the Korea Inclusive Finance Agency.
A small living expenses loan, which provides emergency loans of up to 1 million won at an annual interest rate of 9.4 to 15.9% to those with delinquent loans and low credit, was launched on the 27th of last month, and loan applications worth about 3.5 billion won were made in about a week.
According to Seogeumwon, during this period, out of 6,250 reservations, 5,747 consultations were conducted. Of these, a total of 5,264 cases were complex counseling, including 2,242 cases of debt adjustment, 1,298 cases of welfare linkage, 583 cases of employment support, 593 cases of dormant deposits, 48 cases of reporting illegal private financing, and 500 cases of debtor representation.
Many of the borrowers not only received loans, but also received additional counseling for mid- to long-term financial self-sufficiency.
Of these, 5,499 cases, worth 3.51 billion won, were received as loan applications. The average loan amount is around 640,000 won. The 248 cases in which loans were not provided were not eligible for support because they were people who did not meet the requirements for low credit or low income, were tax delinquents, or were in financial disorder.
Among the loan applications received, 3,874 cases had a loan amount of 500,000 won, and 1,625 cases exceeded 500,000 won with proof of the source of funds, such as hospital expenses.
An official from the Korea Inclusive Finance Agency said, “For those with diseases and no income, there are government support measures such as living allowances and medical allowances, but there are quite a lot of people who do not know about them.” He added, “In addition to providing information on these public welfare welfare systems, job guidance, and information on damage from illegal private lending are provided.” “We are increasing the effectiveness of loan support by providing reporting information and dormant deposit information in parallel,” he explained.
Meanwhile, due to the high demand for small-scale living expenses loans, the Financial Services Commission is reviewing ways to secure additional financial resources.
Kim Joo-hyun, Chairman of the Financial Services Commission, said, “About 700 million won goes out (as a loan) a day, which is an amount that can be used for a few months with what we already have (100 billion won),” and added, “We are internally thinking about raising additional financial resources and looking into various ways.” “It’s under review,” he said. It is known that a plan to utilize surplus funds from the National Happiness Fund, which is operated and managed by the Savings Fund, is likely to be influential.
The original budget for small living expenses loans was a total of 100 billion won, including 50 billion won from Korea Asset Management Corporation and 50 billion won from banking institutions.
[Gyeonggi Newspaper = Reporter Baek Seong-jin]
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UPDATE: December 02, 2023 19:36
