The related form for reporting illegal private lending will be improved so that victims of illegal debt collection, creditor information, financial transaction history, and other details can be specified concretely.
The Financial Services Commission said on the 28th that a bill to amend the lending business act with these measures was approved at a Cabinet meeting.
The amendment specifies the report form to enable faster responses to illegal private lending. Reporters are to be classified and entered as types such as illegal private lending victims, persons related to victims, and third parties.
To facilitate relief measures for victims, it was improved to require specific entries such as creditor information, loan terms, and illegal debt collection damage, and to structure responses as much as possible as multiple-choice items. Previously, reporters freely entered personal details and damage descriptions without a set format. As a result, crime information necessary for investigations was omitted.
The Credit Counseling & Recovery Service (CCRS) will be added to the list of institutions that can request the Ministry of Science and ICT to suspend use of phone numbers used for illegal private lending. Previously, only mayors and provincial governors, the prosecutor general, the commissioner general of the Korean National Police Agency, the governor of the Financial Supervisory Service, and the head of the Korea INclusive Finance Agency (KINFA) could make such requests.
Meanwhile, in about eight weeks since the launch of the one-stop comprehensive and dedicated support service for illegal private lending, 233 people visited the Integrated Support Center for Inclusive Finance for counseling. Of these, 171 victims reported 1,233 cases of illegal private lending damage. Among the victims (171 people), 106 (62.0%) were men and 65 (38.0%) were women. By age group, people in their 40s were the largest at 56 (32.7%), followed by those in their 30s at 48 (28.1%), 50s at 35 (20.5%), those 29 and under at 21 (12.3%), and 60 and older at 11 (6.4%).
The amount of illegal private lending per person (loan principal) was about 10.97 million won, and the damage per person (actual amount repaid) was about 16.2 million won. The annual interest rate was about 1,417%, far exceeding the 60% threshold that renders a lending contract void.
An official at the Financial Services Commission said, "Victims of illegal private lending can now report, without omission, information necessary for relief and investigations, such as details of the damage," and noted, "Because the Credit Counseling & Recovery Service can block illegal phone numbers identified during counseling, the speed of blocking burner phones is expected to be faster than before."