The New Start Fund adjusted 9.8 trillion won in debt (114,000 people) out of 27.7 trillion won in debt adjustment applications (175,000 people) from 2023 through last year. Assuming a 70% debt adjustment rate, that amounts to writing off 6.86 trillion won.
The Financial Services Commission held a "New Start Fund progress review meeting" at Government Complex Seoul on the 26th and stated accordingly.
By year, last year's performance was the highest. The amount of debt applied for last year was 11 trillion won, up 18% from the previous year, and the amount of contracted debt was 4.9 trillion won, a 72% increase from the previous year. This was thanks to 700 billion won being reflected in the New Start Fund through the second extra budget last year, expanding eligibility for support. The maximum principal reduction rate was also raised from 80% to 90%.
Four lenders — The LEADCORP, Baro Credit Lend, Sunny Capital Lend, and Just In Time Lend — joined the New Start Fund in January. The Financial Services Commission (FSC) expects that, going forward, debt held by lenders will be included as eligible for New Start Fund support, expanding those eligible for debt adjustment support.
The Financial Services Commission (FSC) is reviewing ways to grant incentives when a debtor repays early. If a debtor repays without arrears for one year after a debt adjustment, the interest rate after adjustment would be cut by an additional 10% each year. A plan will also be implemented to further reduce 5%–10% of the remaining debt if small business owners and the self-employed who have repaid faithfully for one year repay the remaining debt in a lump sum.
Reasons for repayment deferment that keep the agreement in place even if a debtor cannot repay temporarily will be expanded from the previous illness and serious disease to include parental leave and childbirth. Programs for employment and startups will also be expanded so that debtors can successfully make a fresh start.