Jeong Seon-in, head of the microfinance department at the Financial Services Commission
A flood of applications… Efforts to provide complex counseling support such as debt restructuring
“I thought it was not unusual because the number of cases falling into illegal private finance increased rapidly because of 400,000 to 600,000 won.”
Jeong Seon-in (Act 46), head of the Financial Services Commission’s finance department for the low-income, revealed this in an interview with the Seoul Shinmun on the 29th about the background of the recent launch of the small-amount livelihood loan. The small-amount livelihood loan is a policy product that lends up to 1 million won to low-credit borrowers with an annual income of 35 million won or less and a credit rating of 20% or less. Manager Jeong is the protagonist who led the launch of micro-living loans for the first time in the institutional sector. Recently, seeing an increase in cases of illegal private finance damage, such as the so-called ‘rescue loan’ (a loan to save myself) using mobile phone scams, judged the situation to be serious, and the Consumer Affairs Bureau of the Financial Services Commission came together to promote the policy.
The purpose was good, but it was hit hard by the political circle before it was released. The fact that the interest rate is 15.9% per annum has been criticized by the financial authorities for conducting ‘interest-rate business’. Some pointed out how helpful a one-time loan of 500,000 won to 1 million won would be to the low-income class. However, once the policy was launched, the situation changed 180 degrees. From the first day of advance reservations for loan counseling, applicants flooded in. It was a success as 1126 loans were executed only on the 27th, when the actual loans were executed. Manager Jeong said, “It means that there are so many difficult people, so I am careful to say that it is a box office success.”
Above all, it is explained that the focus of the financial authorities is not only small loans but complex counseling support for borrowers. In order to receive a micro-living loan, which is unusual, you must receive face-to-face counseling at the Microfinance Integrated Support Center. Manager Jeong said, “Many of the vulnerable classes were unable to receive welfare system support because they did not know about it.” We are trying to provide fundamental support,” he said. Manager Jeong said, “It is a very experimental system from the perspective of the financial authorities,” adding, “The guidelines are supplemented every day. In the future, we will correct the inadequacies and implement the policy.”
Written and photographed by Song Soo-yeon, staff reporter
