In October, the number of individual borrowers who fell into arrears on bank loans and credit loans exceeded 6 million, and the arrears balance approached 50 trillion won.
According to data submitted by the Financial Supervisory Service and the Credit Information Center to Representative Kim Hyun-jeong's office of the Democratic Party on the 15th, the number of individual borrowers who fell into arrears registered in the Credit Information Center's creditor change information system at the end of October was counted at 6,144,000. The number of arrears cases was 21,460, and the balance was 49.4441 trillion won.
The creditor change information system was restructured in September, and when individuals fall into arrears on loans, credit loans, cash services, or credit card transactions, the information is registered within five business days. The arrears history of individual business loans is also included, allowing for a comprehensive understanding of individual debt arrears status.
Representative Kim noted, "The fact that the number of individual and individual business borrowers in arrears is 6.14 million is a shocking figure that reveals the ugly reality of our economy," adding, "If this is left unattended, there is concern that the household debt crisis could spread as a risk to the overall economy."
The scale of card loans, referred to as typical cash loans for ordinary citizens, is 42.2201 trillion won (based on nine credit card companies), an increase of 533.2 billion won, breaking the record set at the end of August.
As the debt repayment capacity of financially vulnerable groups declines, the number of illegal private loan victims is also increasing. According to data received by the Representative's office from the Korea Financial Services Agency, the number of illegal private loan consultations at the Integrated Support Center for Ordinary Citizens from January to October reached 42,409, already exceeding four times the level of last year (10,130).
According to a counseling case from the Financial Services Agency, a woman in her 20s, identified as A, residing in Gwangju, lost her parents at a young age and was working alone as a barista when she became exposed to illegal private loans after her business closed down, lured by phrases like "no collateral, no guarantee, no fees for same-day loans."
After applying for a loan, A became a victim of identity theft and then became involved in legal issues, receiving a fine and community service. In response, the Financial Services Agency supported a micro-living expenses loan to resolve her health insurance arrears. They also reduced her interest repayment burden through a connection with the Credit Recovery Committee for debt adjustment. A began working at a local self-sufficiency center from July.
Kim stated, "The fact that many citizens are falling into arrears on loans and being driven to illegal private loans signifies the severity of economic inequality and hardship," adding, "The government and financial authorities must present effective measures for the economic stability of citizens."