The financial authorities asked a private expert task force (TF) to review the current status and problems of the existing credit rating system and to draw up institutional improvement plans to lay the groundwork for productive, inclusive finance and trusted finance.
The Financial Services Commission held a kickoff meeting of the credit evaluation system reform TF on the 20th, chaired by Vice Chair Kwon Dae-young of the Financial Services Commission, and discussed these matters. The TF was convened to swiftly carry out national agenda items such as advancing credit evaluation for small business owners and presidential briefing tasks such as establishing an alternative information center and introducing credit growth accounts.
Vice Chair Kwon emphasized that the credit evaluation system should be a strong safety net for "inclusive finance," not a high wall of "cruel finance." Kwon also asked for a comprehensive reexamination of the credit evaluation framework to shift from exclusionary finance (exclusion) to inclusive finance (inclusion).
In particular, Vice Chair Kwon emphasized that to prevent policies for inclusive finance from ending as one-off, formal support, the fundamental credit evaluation system must be overhauled. Kwon also asked the TF to produce a comprehensive set of institutional improvement plans so that the credit evaluation framework can become core infrastructure for a major financial transition.
At the meeting, participants reviewed and assessed the status of personal credit evaluation and discussed tasks to vitalize alternative credit evaluation. Korea Credit Bureau said that, given changes in the macro financial environment and the status of credit management, the share of top personal credit scores has risen sharply, making it time to consider adjusting evaluation criteria and redeveloping evaluation models.
According to NICE Information Service, financial companies require significant time and resources to analyze alternative information they have secured, and multiple consent procedures impose a heavy burden on adopting alternative information. In addition, there is no infrastructure for integrated management of alternative information, and financial companies lack practical incentives to actively adopt alternative credit evaluation.
They also discussed the status and tasks of credit evaluation for sole proprietors (small business owners). The Korea Credit Information Services explained that sole proprietors account for about 87% of small and midsize enterprises, but the traditional sole proprietor credit evaluation framework—focused on "collateral·personal" characteristics—relies heavily on financial information and evaluates from a risk perspective, making it difficult to sufficiently reflect business viability.
Going forward, the TF will discuss ▲ reforming the personal credit evaluation framework ▲ advancing credit evaluation for sole proprietors (small business owners) (integrated information center, specialized credit evaluation models) ▲ vitalizing alternative credit evaluation ▲ strengthening credit evaluation using AI and other tools, and will make a series of announcements as soon as detailed implementation plans are finalized.