Korea to help low-income households' access to financial services.
The Financial Services Commission (FSC) announced on April 18 measures to lower financial costs of low-income households and strengthen the financial safety net. According to the plan, Korea will provide 3.2 trillion won in loans to low-income families this year through its three lending programs: Smile Microcredit, Sunshine Loans; and New Hope Loans.
Regarding individual credit rating, credit inquiry records would be no longer taken into the assessment of individuals' credit rating. In addition, overdue payments of less than 100,000 won would not affect borrower's credit rating. Overdue payments of less than 90 days would be reflected only for three years, in the assessment of borrower's credit ratings if debts are fully repaid.
As a part of the plan, measures such as putting a cap on loan brokerage fees, strengthening the crackdown on illicit brokerage practices, extending the operation of pre-workout program, broadening the scope of beneficiaries of transfer loans, and expanding financial support for those in the credit recovery program, establishing a database of financial services targeting low-income earners and creating more education programs for them are included.
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|Title Annotation:||Economic News Briefing|
|Publication:||Economic Bulletin (Korea)|
|Article Type:||Brief article|
|Date:||May 1, 2011|
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